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This article appeared in a journal published by Elsevier. The attached copy is furnished to the author for internal non-commercial research and education use, including for instruction at the authors institution and sharing with colleagues. Other uses, including reproduction and distribution, or selling or licensing copies, or posting to personal, institutional or third party websites are prohibited. In most cases authors are permitted to post their version of the article (e.g. in Word or Tex form) to their personal website or institutional repository. Authors requiring further information regarding Elsevier’s archiving and manuscript policies are encouraged to visit: /copyright Authors personal copy Journal of International Economics 75 (2008) 30 – 53 /locate/econbase Endogenous discounting, the world saving glut and the ☆ U.S. current account Horag Choi a , Nelson C. Mark b, ⁎, Donggyu Sul a a University of Auckland, New Zealand b University of Notre Dame and NBER, United States Received 24 May 2007; accepted 25 October 2007 Abstract We study the evolution of the U.S. current account in a two-country dynamic stochastic endowment model in which a single non-state contingent bond is the only internationally traded asset. The paper focuses on the world ‘saving glut’ as the primary cause of conti