International Capital Mobility in African Countries: Do the legal origins matter?

Chrysost Bangaké and Jude Eggoh ()

Economics Bulletin, 2010, vol. 30, issue 1, 73-83

Abstract: This paper investigates the Feldstein-Horioka coefficients and legal origins for 37 African countries using the recently developed panel cointegration techniques. The empirical findings reported in the paper reveal that savings and investment are nonstationary and cointegrated series. The estimated coefficients using DOLS is 0.58 for the sample as a whole for the period 1970-2006. However, there are marked differences in retentions ratios in each country group with ratio lowest in common law countries (0.34) compared to French civil law countries (0.85). These results imply that in the countries with strong legal protections of investors, capital tends to be mobile internationally than in countries with worse protection.

Keywords: Feldstein-Horioka coefficient; panel unit root tests; DOLS panel cointegration; Africa. (search for similar items in EconPapers)
JEL-codes: F3 (search for similar items in EconPapers)
Date: 2010-01-06
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Citations: View citations in EconPapers (3)

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