Table 13.

The effect of fiscal consolidation on current account for the 2009–2014 period

	Dynamic Panel Estimation SGMM
	(1)	(2)	(3)	(4)	(5)	(6)
${\mathit{CA}}_{it-1}$	0.603*** (0.188)	0.509*** (0.101)	0.951*** (0.166)	0.735*** (0.133)	0.720*** (0.103)	0.715*** (0.128)
${\mathit{fa}}_{\mathit{it}}$	0.858** (0.365)	0.288* (0.173)	0.312** (0.144)	0.377* (0.221)	0.380* (0.214)	0.377** (0.207)
${\mathit{corrup}}_{\mathit{it}}$		2.253*** (0.835)	−0.326 (0.746)	4.323** (1.688)	0.410 (0.923)	−0.242 (0.324)
${\mathit{debt}}_{\mathit{it}}$			0.081* (0.042)	0.143*** (0.040)	0.032** (0.016)	0.068** (0.033)
${\mathit{gdpg}}_{\mathit{it}}$				0.174** (0.080)	0.225** (0.093)	0.146** (0.080)
${\mathit{eldy}}_{\mathit{it}}$					−0.126 (0.114)	−0.152 (0.092)
${\mathit{young}}_{\mathit{it}}$						−0.133** (0.054)
N	115	115	115	114	114	114
groups	23	23	23	23	23	23
N-instr	9	16	16	12	22	14
AR(1)	0.079	0.223	0.047	0.015	0.084	0.025
AR(2)	0.469	0.521	0.662	0.665	0.689	0.621
Hansen	0.234	0.201	0.145	0.542	0.467	0.365

Robust standard errors are in parentheses. Regressions are based on the Blundell-Bond estimator. Starting from the most parsimonious specification (column 1), we progressively introduce GDP growth, corruption, public debt, eldy and young population in columns (2)–(6). Significance level at which the null hypothesis is rejected: p < 0.1*; p < 0.05**; p < 0.01***