A panel cointegration approach to the investment-saving correlation

Tsung-wu Ho ()
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Tsung-wu Ho: Department of Economics, Shih Hsin University, No. 1, Lane 17, Section 1, Mu-Cha Road, Taipei, 11602, Taiwan, R.O.C.

Empirical Economics, 2002, vol. 27, issue 1, 100 pages

Abstract: This paper augments the empirical literature concerning the Feldstein-Horioka puzzle using non-stationary panel data. Recently developed tests for panel cointegration and panel unit root tests are employed. We find substantial evidence to support the hypothesis of no cointegration in this panel, implying a high degree of international capital mobility. Our results suggest that tests for cointegration in panel data provides a better methodological focus than the magnitude of saving-retention coefficients.

Keywords: Panel; cointegration; ·; Saving-retention; coefficient; ·; International; capital; mobility (search for similar items in EconPapers)
JEL-codes: C23 F30 (search for similar items in EconPapers)
Date: 2002-02-19
Note: received: August 1999/Final version accepted: December 2000
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Citations: View citations in EconPapers (32)

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