 Examining the Feldstein–Horioka puzzle using common factor panels and interval estimationIsamu Ginama, Kazuhiko Hayakawa and Takahiro Kanmei Japan and the World Economy, 2018, vol. 48, issue C, 11-21 Abstract: The article empirically examines the Feldstein–Horioka puzzle using national data from 23, 24, and 29 Organisation for Economic Cooperation and Development (OECD) countries, along with regional economic data from Japan, Indonesia, and the Philippines. The article applies a panel model with common factors to data from the OECD countries, Japan, and Indonesia. Few data exist for the Philippines. Therefore, to analyze its regional data, a different method is used: it simultaneously removes influences on savings and investment rates by regression analyses, except for intranational capital flows. Significant and not significant statistical evidence are found to support the existence of the Feldstein–Horioka puzzle for OECD countries during three observation periods. However, evidence of mobile intranational capital flows exists in Japanese and Indonesian data. Bootstrap BCa confidence intervals of the correlation coefficient between savings and investment rates also show mobile intranational capital flows for data of the Philippines. Keywords: Capital mobility; Regional data; Developing countries; Common factor panel models; BCa confidence interval (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:japwor:v:48:y:2018:i:c:p:11-21 DOI: 10.1016/j.japwor.2018.06.001 Access Statistics for this article Japan and the World Economy is currently edited by Robert Dekle and Yasushi Hamao More articles in Japan and the World Economy from Elsevier |
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