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

2003-01-20
Ozmen, E
Parmaksiz, K
This paper investigates whether the Feldstein and Horioka (Economic Journal, 90, 314-29, 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.

Citation Formats
E. Ozmen and K. Parmaksiz, “Exchange rate regimes and the Feldstein-Horioka puzzle: the French evidence,” APPLIED ECONOMICS, vol. 35, no. 2, pp. 217–222, 2003, Accessed: 00, 2020. [Online]. Available: https://hdl.handle.net/11511/64946.