Investigating Saving and Investment Relationship: Evidence from an Autoregressive Distributed Lag Bounds Testing Approach in Liberia

Joe Garmondyu Greaves
Additional contact information
Joe Garmondyu Greaves: Department of Economics, Huazhong University of Science and Technology, Wuhan, China.

International Journal of Economics and Financial Issues, 2018, vol. 8, issue 4, 89-104

Abstract: The core thesis of this paper is to investigate the long-run relationships between the domestic investment and domestic savings of the Liberian economy using 1970-2016 full sample data and 1970-2012 subsample annual time series data. This paper uses the Augmented Dickey Fuller unit root test to ascertain the order of integration for the two time series variables as well as two structural breaks tests to counter check the accuracy of the unit root test. After detecting the mixed order of integration for the bivariate series, the Autoregressive Distributed Lag (ARDL) was employed using the bounds test to study the long-run linkage between the investment and saving series and the unrestricted and restricted error correction techniques within the ARDL framework to delve in the Felstein-Horioka analytical framework. The bounds test approach shows that cointegration coexist using all the samples considered in this study.

Keywords: Cointegration; Saving; Investment; Felstein-Horioka; Liberia; ARDL (search for similar items in EconPapers)
JEL-codes: E2 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.econjournals.com/index.php/ijefi/article/download/6569/pdf (application/pdf)
https://www.econjournals.com/index.php/ijefi/article/view/6569/pdf (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eco:journ1:2018-04-12

Access Statistics for this article

International Journal of Economics and Financial Issues is currently edited by Ilhan Ozturk

More articles in International Journal of Economics and Financial Issues from Econjournals
Bibliographic data for series maintained by Ilhan Ozturk ().