Exchange controls, international capital flows and saving-investment correlations in the UK: An empirical investigation

Sarno, Lucio; Taylor, Mark P.

doi:10.1007/bf02707579

Cited by 30 publications

(16 citation statements)

References 38 publications

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“…The results show that this may be misleading if saving is not weakly exogenous for the parameters of the cointegration vector. 6 This result is consistent with the works ofMiller (1988),Lemmen and Eijfinger (1995) andSarno and Taylor (1998) who provide evidence that saving and investment are not cointegrated after an exogenously imposed break point coinciding with the end of the Bretton Woods system.…”

supporting

confidence: 93%

Exchange rate regimes and the Feldstein-Horioka puzzle: the French evidence

Özmen

Parmaksiz

2003

Applied Economics

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This paper investigates whether the Feldstein and Horioka (Economic Journal, 90, 314-329, 1980) argument on domestic saving-investment relationship is supported by the French data when an endogenous structural break corresponding to a major policy regime change is taken into account. The evidence suggests that the saving-investment cointegration disappears after the estimated endogenous structural break point in 1973 coinciding with the end of the Bretton Woods system of fixed exchange rates. Consistent with a current account targeting policy, an investment-driven saving process appears to be the case for the fixed exchange rate regime period.

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supporting

confidence: 93%

Exchange rate regimes and the Feldstein-Horioka puzzle: the French evidence

Özmen

Parmaksiz

2003

Applied Economics

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“…This theory has generated voluminous literature over the last couple of decades. Several studies (see, inter alia, Sarno and Taylor, 1998;Abbott and Vita, 2003;Schmidt, 2003;Narayan, 2005) have tested this theory. At best, the empirical results are mixed.…”

Section: Introductionmentioning

confidence: 92%

The saving and investment nexus for China: evidence from cointegration tests

2005

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The saving and investment nexus as postulated by Feldstein and Horioka (FH) (1980) is revisited. The saving investment correlation for China is estimated over the periods 1952-1998 and 1952-1994, the latter culminating in a period of fixed exchange rate regime. Amongst the key results, it is found that saving and investment are correlated for China for both the period of the fixed exchange rate and the entire sample period. With high saving-investment correlation, the results suggest that the Chinese economy is in conformity with the FH hypothesis. This is a valid outcome, for in China capital mobility was fairly restricted over the 1952-1994 period as indicated by the relatively low foreign direct investment.

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“…Because of the small sample period, tests on the stationarity of the time series could not be performed. Earlier results do suggest, however, that the assumption of non-stationarity of savings and investment rates cannot be dismissed a priori (Coakley et al 1996;Sarno and Taylor 1998;Kellermann and Schlag 1998). 11 We have thus also estimated equation (1) in first differences.…”

Section: Panel Datamentioning

confidence: 97%

Capital mobility and EU enlargement

Buch¹

1999

Weltwirtschaftliches Archiv

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*The EU has recently entered accession talks with five transition economies of eastern Europe. Membership in the EU would require inter alia the full liberalization of capital flows. This paper provides empirical evidence on the openness towards foreign capital that the accession states have attained so far on the basis of the correlation between domestic saving and investment. A comparison with the southern members of the EU shows that the countries under review have reached a similar degree of integration in quantitative terms. Yet, further adjustment in qualitative terms, i.e., in the structure of capital flows, can be expected as the process of accession proceeds. (105 words)

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Exchange controls, international capital flows and saving-investment correlations in the UK: An empirical investigation

Abstract: F20, F41,

Cited by 30 publications

References 38 publications

Exchange rate regimes and the Feldstein-Horioka puzzle: the French evidence

Exchange rate regimes and the Feldstein-Horioka puzzle: the French evidence

The saving and investment nexus for China: evidence from cointegration tests

Capital mobility and EU enlargement

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