THE SAVING-INVESTMENT RELATIONSHIPS: A MARKOV SWITCHING CAUSALITY ANALYSIS OF COTE D´IVOIRE AND GHANA

Bedia F. Aka ()

Applied Econometrics and International Development, 2007, vol. 7, issue 2, 155-162

Abstract: This paper investigates the empirical saving-investment relationships for Côte d’Ivoire and Ghana over the period 1960–1998, using a Markov Switching VAR model. We find regime-dependent causality from saving to investment in Côte d’Ivoire but not in Ghana. In terms of Feldstein and Horioka (1980) capital mobility hypothesis these findings suggest a more capital mobility in Ghana than in Côte d’Ivoire implying that foreign capital flows towards Côte d’Ivoire and not to Ghana during the studied period.

Keywords: Saving; Investment; Markov Switching VAR; Causalit (search for similar items in EconPapers)
JEL-codes: C22 C51 I20 O54 (search for similar items in EconPapers)
Date: 2007
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