Since the mid-1990s sustainability of large and persistent current account positions have been
attracting much attention from policy makers and economists alike. Alongside global imbalances
sustainability of imbalances within the euro area which started widening shortly after the
introduction of the euro raised much concern. While there exists a large body of theoretical
and empirical literature on sustainability of external imbalances a systematic survey has been
lacking so far. Angélique Herzberg fills this gap by examining a broad range of established
sustainability measures concerning their applicability to the various global and intra-euro
imbalances of the recent past. Furthermore the author examines the existence of feedback
effects from an economy´s net international investment position to its trade balance.
