Revisit Feldstein-Horioka puzzle: evidence from Malaysia

Chor Foon Tang and Hooi Hooi Lean ()

Economics Bulletin, 2011, vol. 31, issue 3, 2237-2249

Abstract: The aim of this study is to re-visit the Feldstein and Horioka (1980) puzzle for Malaysia. The conventional bounds testing approach cannot show any evidence of cointegration between savings and investment. However, the result of our proposed rolling bounds test approach shows that the cointegrated relationship varied over time. In particular, the variables are cointegrated only prior to the Asian financial crisis and the Ringgit pegged regime in 1997/98.

Keywords: Malaysia; Rolling cointegration test; Savings-investment nexus (search for similar items in EconPapers)
JEL-codes: C1 E2 (search for similar items in EconPapers)
Date: 2011-08-05
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Citations: View citations in EconPapers (3)

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