Skip to main content
SpringerLink
Log in

Unit root tests of capital mobility in the less developed countries

  • Shorter Papers & Comments
  • Published:
Weltwirtschaftliches Archiv Aims and scope Submit manuscript

Conclusions

This article contributes to the ongoing debate on international capital mobility in the LDCs. The extent of capital mobility has been assessed in a time-series context, performing unit root tests on the adjusted current account for thirty-seven developing countries. The results show that the hypothesis of capital mobility cannot be rejected in a large number of countries.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Azariadis, C. (1993).Intertemporal Macroeconomics. Cambridge: Basil Blackwell.

    Google Scholar 

  • Campbell, J.Y., and P. Perron (1991). Pitfalls and Opportunities: What Macroeconomists Should Know about Unit Roots.NBER Macroeconomics Annuals 6:141–200.

    Article  Google Scholar 

  • Cohen, D. (1991).Private Lending to Sovereign States: a Theoretical Autopsy. Cambridge, MA: The MIT Press.

    Google Scholar 

  • DeHaan, J., and C. L. J. Siermann (1994). Saving, Investment, and Capital Mobility: A Comment on Leachman.Open Economies Review 5(1):5–17.

    Article  Google Scholar 

  • Dickey, D., and W. Fuller (1981). Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root.Econometrica 49(4): 1057–1072.

    Article  Google Scholar 

  • Dolado, J.J., T. Jenkinson, and S. Sosvilla-Rivero (1990). Cointegration and Unit Roots.Journal of Economic Surveys 4(3): 249–273.

    Article  Google Scholar 

  • Dooley, M., J. Frankel, and D. Mathieson (1987). International Capital Mobility: What Do Saving-Investment Correlations Tell Us?IMF Staff Papers 34(3): 503–530.

    Google Scholar 

  • Easterly, W.R., P. Mauro, and K. Schmidt-Hebbel (1995). Money Demand and Seigniorage Maximizing Inflation.Journal of Money, Credit, and Banking 27 (2): 583–603.

    Article  Google Scholar 

  • Engle, R. F., and C. W. J. Granger (1987). Cointegration and Error Correction: Representation, Estimation and Testing.Econometrica 55(2): 251–276.

    Article  Google Scholar 

  • Evans, G. B. A., and N. E. Savin (1984). Testing for Unit Roots: 2.Econometrica 52(5): 1241–1269.

    Article  Google Scholar 

  • Feldstein, M., and C. Horioka (1980). Domestic Saving and International Capital Flows.Economic Journal 90(June): 314–329.

    Article  Google Scholar 

  • Fleming, J. M. (1962). Domestic Financial Policies under Fixed and under Floating Exchange Rates.IMF Staff Papers 9(3): 369–380.

    Google Scholar 

  • Frankel, J. (1989).Quantifying Capital Mobility in the 1980’s. UCLA, mimeo.

  • — (1992). International Capital Mobility: A Review.American Economic Review 82(1): 197–202.

    Google Scholar 

  • Fuller, W. (1976).Introduction to Statistical Time Series. New York: John Wiley and Sons.

    Google Scholar 

  • Genberg, H., and A. Swoboda (1992). Saving, Investment and the Current Account.Scandinavian Journal of Economics 94(2): 347–366.

    Article  Google Scholar 

  • Ghosh, A. (1995). International Capital Mobility amongst the Major Industrialised Countries: Too Little or Too Much?Economic Journal 105(January): 107–128.

    Article  Google Scholar 

  • Granger, C. W. J., and P. Newbold (1974). Spurious Regressions in Econometrics.Journal of Econometrics2 (2): 111–120.

    Article  Google Scholar 

  • Gundlach, E., and S. Sinn (1992). Unit Root Tests of the Current Account Balance: Implications for International Capital Mobility.Applied Economics 24(6): 617–625.

    Article  Google Scholar 

  • Haque, N., and P. J. Montiel (1991). Capital Mobility in Developing Countries: Some Empirical Tests.World Development 19(10): 1391–1398.

    Article  Google Scholar 

  • Leidermann, L., and A. Razin (eds.) (1994).Capital Mobility: The Impact on Consumption, Investment and Growth. Cambridge: Cambridge University Press.

    Google Scholar 

  • Levich, R. M. (1985). Empirical Studies of Exchange Rates: Price Behavior, Rate Determination and Market Efficiency. In R. W. Jones and P. B. Kenen (eds.),Handbook of International Economics, Vol. II. Amsterdam: Elsevier.

    Google Scholar 

  • Mamingi, N. (1993). Saving-Investment Correlations and Capital Mobility in Developing Countries. Policy Research Working Papers 1211, The World Bank.

  • Montiel, P. J. (1994). Capital Mobility in Developing Countries: Some Measurement Issues and Empirical Estimates.World Bank Economic Review 8(3): 311–350.

    Article  Google Scholar 

  • Mundeil, R. A. (1968).International Economics. New York: MacMillan.

    Google Scholar 

  • Obstfeld, M. (1993). International Capital Mobility in the 1990’s. NBER Working Papers 4534.

  • O’Connel, S. A., and S. P. Zeldes (1988). Rational Ponzi Games.International Economic Review 9(3):431–450.

    Article  Google Scholar 

  • Phillips, P.C. B., and B. E. Hansen (1990). Statistical Inference in Instrumental Variables Regression with I(1) Processes.Review of Economic Studies 57(1): 99–125.

    Article  Google Scholar 

  • Phillips, P. C. B., and P. Perron (1988). Testing for a Unit Root in Time Series Regression.Biometrika 75:335–346.

    Article  Google Scholar 

  • Savin, N. E. (1984). Multiple Hypothesis Testing. In Z. Griliches, and M. D. Intriligator (eds.),Handbook of Econometrics, Vol. II. Amsterdam: Elsevier.

    Google Scholar 

  • Schwert, G.W. (1989). Tests for Unit Roots: A Monte Carlo Investigation.Journal of Business and Economic Statistics 7(2): 147–159.

    Article  Google Scholar 

  • Sinn, Stefan (1992). Saving-Investment Correlations and Capital Mobility: On the Evidence from Annual Data.The Economic Journal 102(September): 1162–1170.

    Article  Google Scholar 

  • Summers, R., and A. Heston (1991). The Penn World Table (Mark 5): An Expanded Set ot International Comparisons, 1950–1988.The Quarterly Journal of Economics 106(2): 327–368.

    Article  Google Scholar 

  • Vos, R. (1988). Savings, Investment and Foreign Capital Flows: Have Capital Markets become More Integrated?The Journal of Development Studies 24(3): 310–334.

    Google Scholar 

  • Wong, Y. D. (1990). What Do Saving-Investment Correlations Tell Us about Capital Mobility?Journal of International Money and Finance 9:55–78.

    Article  Google Scholar 

Download references

Authors
  1. Alberto Bagnai
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Stefano Manzocchi
    View author publications

    You can also search for this author in PubMed Google Scholar

About this article

Cite this article

Bagnai, A., Manzocchi, S. Unit root tests of capital mobility in the less developed countries. Weltwirtschaftliches Archiv 132, 544–557 (1996). https://doi.org/10.1007/BF02707512

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/BF02707512

Keywords

Search

Navigation