Saving, investment and capital mobility in African countries created by Olumuyiwa S. Adedeji and John Thornton

By:

Adedeji Olumuyiwa S [author]

Contributor(s):

Thornton John [co-author]

Material type: Text

TextSeries: Journal of African Economies ; Volume 16, number 3Oxford: Oxford university Press, 2007Content type:

text

Media type:

unmediated

Carrier type:

volume

ISSN:

09638024

Subject(s):

Capital mobility -- Investment -- Estimation -- 1970-2000 -- Africa

LOC classification:

HC800 JOU

Online resources:

Click here to access online

Abstract: Recently developed panel co-integration techniques are applied to data for six African countries to test the Feldstein–Horioka approach to measuring capital mobility. The results suggest three conclusions: savings and investment in panel data are non-stationary series and they are co-integrated; capital was relatively mobile in the African countries during 1970–2000, with estimated savings–retention ratios of 0.73 (FMOLS), 0.45 (DOLS), 0.51 (DOLS with heterogeneity) and 0.39 (DOLS with cross-sectional dependence effects); and there was a marked drop in the savings–retention ratio from 1970–85 to 1986–2000. The results could be interpreted as indicating that capital mobility in African countries has increased, reflecting the implementation of market-orientated reforms, including the privatisation and rationalisation of the public sector, and the partial liberalisation of their exchange rate regimes and financial systems.

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Holdings
Item type	Current library	Call number	Vol info	Copy number	Status	Notes	Date due	Barcode
Journal Article	Main Library - Special Collections	HC800 JOU (Browse shelf(Opens below))	Vol. 16, no. 5 (pages 393-405)	SP1223	Not for loan	For In house Use

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Recently developed panel co-integration techniques are applied to data for six African countries to test the Feldstein–Horioka approach to measuring capital mobility. The results suggest three conclusions: savings and investment in panel data are non-stationary series and they are co-integrated; capital was relatively mobile in the African countries during 1970–2000, with estimated savings–retention ratios of 0.73 (FMOLS), 0.45 (DOLS), 0.51 (DOLS with heterogeneity) and 0.39 (DOLS with cross-sectional dependence effects); and there was a marked drop in the savings–retention ratio from 1970–85 to 1986–2000. The results could be interpreted as indicating that capital mobility in African countries has increased, reflecting the implementation of market-orientated reforms, including the privatisation and rationalisation of the public sector, and the partial liberalisation of their exchange rate regimes and financial systems.

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