Revisiting the Feldstein-Horioka puzzle: an institutional sector view
Working on a sample of OECD countries spanning the period 1970-2003, this paper contributes to the Feldstein-Horioka literature by making three main innovations: (1) It estimates, for the first time, regressions at the institutional sector level (households, corporations, and government); (2) It exp...
Guardado en:
| Autores principales: | , |
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| Formato: | Articulo |
| Lenguaje: | Inglés |
| Publicado: |
2010
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| Materias: | |
| Acceso en línea: | http://sedici.unlp.edu.ar/handle/10915/9365 |
| Aporte de: |
| Sumario: | Working on a sample of OECD countries spanning the period 1970-2003, this paper contributes to the Feldstein-Horioka literature by making three main innovations: (1) It estimates, for the first time, regressions at the institutional sector level (households, corporations, and government); (2) It explores the asymmetry between current account deficits and surpluses; and (3) It uses advanced panel data techniques to deal with endogeneity and to distinguish long- and short-run effects. The conclusions of the paper are that: (i) The national Feldstein-Horioka coefficient is in the vicinity of 0.5, but sectoral coefficients are much lower, a puzzling result possibly explained by endogenous intersectoral saving and investment links; (iii) The FH coefficients are higher in deficit than in surplus years; and (iv) The long-run relationship is in all cases below 1, which raises the question as to whether the intertemporal budget constraint should be interpreted. |
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