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

Date

2003-01-20

Author

Ozmen, E
Parmaksiz, K

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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.

Subject Keywords

Saving-investment correlations, İnternational capital flows, Time-series, Unit-root, Tell us, Cointegration, İntegration, Statistics, Variables, Mobility

URI

https://hdl.handle.net/11511/64946

Journal

APPLIED ECONOMICS

DOI

https://doi.org/10.1080/0003684021000025397

Collections

Department of Economics, Article

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Citation Formats

E. Ozmen and K. Parmaksiz, “Exchange rate regimes and the Feldstein-Horioka puzzle: the French evidence,” APPLIED ECONOMICS, pp. 217–222, 2003, Accessed: 00, 2020. [Online]. Available: https://hdl.handle.net/11511/64946.