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Book Cover
Author Jansen, W. J.

Title The Feldstein-Horioka test of international capital mobility : Is it feasible? / prepared by W. Jos Jansen
Published [Washington, D.C.] : International Monetary Fund, Research Dept., [1996]
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Description 1 online resource (iii, 23 pages) : illustrations
Series IMF working paper ; WP/96/100
IMF working paper ; WP/96/100
Summary Annotation Feldstein and Horioka (1980) argued that the correlation of saving and investment in a cross-section of countries may provide a test of global capital mobility. This paper argues that neither the long-run nor the short-run correlation can serve as a reliable basis for such a test. the intertemporal budget constraint implies that each countrys saving and investment should be cointegrated over time. Simulations show that the cross-section regressions used in the literature will produce correlations that strongly tend towards one, regardless of the degree of capital mobility. Although the short-run correlation is not affected by the intertemporal budget constraint, the empirical analysis shows it is primarily a country-specific business cycle fact
Bibliography Includes bibliographical references (pages 20-23)
Notes Master and use copy. Digital master created according to Benchmark for Faithful Digital Reproductions of Monographs and Serials, Version 1. Digital Library Federation, December 2002. MiAaHDL
digitized 2010 HathiTrust Digital Library committed to preserve pda MiAaHDL
Print version record
Subject Capital movements -- Econometric models.
Saving and investment -- Econometric models.
Form Electronic book
Author International Monetary Fund. Research Department.
ISBN 145520501X