A Noteon Saving-Investment Correlations in the EMS

International Monetary Fund

No 1990/097, IMF Working Papers from International Monetary Fund

Abstract: This paper extends recent work by Feldstein and Horioka (1980) and Bayoumi (1990), and examines saving-investment correlations for industrial countries in the post-war period. The focus of the enquiry is on differences observed between EMS and non-EMS countries. It is seen that the EMS countries exhibit much lower saving-investment correlations than their non-EMS counterparts. This result supports the hypothesis that exchange rate stability achieved in the EMS has been an important factor in promoting international capital mobility.

Keywords: WP; EMS country; EMS; EMS period; EMS group; saving-investment equation; investment correlation; Gold; Exchange rate stability; Capital flows; Conventional peg; Time series analysis (search for similar items in EconPapers)
Pages: 34
Date: 1990-01-01
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Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:1990/097

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