01734cas a2200253 a 4500 AALejournalIMF011809 230101c9999 xx r poo 0 0eng d 5.00 USD 9781475502886 1018-5941 BD-DhAAL BD-DhAAL Wieladek, Tomasz. Financial Regulation and the Current Account / Tomasz Wieladek, Sergi Lanau. Washington, D.C. : International Monetary Fund, 2012. 1 online resource (51 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper examines the relationship between financial regulation and the current account in an intertemporal model of the current account where financial regulation affects the current account through liquidity constraints. Greater liquidity constraints decrease the size and persistence of the current account response to a net output shock. The theory is tested with an interacted panel VAR model where the coefficients are allowed to vary with the degree of financial regulation. The current account reaction to an output shock is 60% larger and substantially more persistent in a country with low financial regulation than in one with high financial regulation. Mode of access: Internet Lanau, Sergi. IMF Working Papers; Working Paper ; No. 2012/098 Full text available on IMF http://elibrary.imf.org/view/journals/001/2012/098/001.2012.issue-098-en.xml IMF e-Library