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Capital mobility: evidence from four South Asian economies

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  • Arusha Cooray

Abstract

This paper examines the degree of capital mobility in four South Asian economies, namely, India, Sri Lanka, Pakistan and Bangladesh. The paper extends the Shibata and Shintani (1988) model to incorporate the interest rate differential. While the empirical results appear to be country specific, in general, capital does not appear to be mobile in South Asia. The results suggest that the interest rate differential is not related to changes in consumption in South Asia.

Suggested Citation

  • Arusha Cooray, 2005. "Capital mobility: evidence from four South Asian economies," Applied Economics Letters, Taylor & Francis Journals, vol. 12(9), pages 577-581.
  • Handle: RePEc:taf:apeclt:v:12:y:2005:i:9:p:577-581
    DOI: 10.1080/13504850500142296
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    References listed on IDEAS

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    Cited by:

    1. Yu Hsing & A. M. M. Jamal & Wen-jen Hsieh, 2009. "Application of the monetary policy function to output fluctuations in Bangladesh," Economics Bulletin, AccessEcon, vol. 29(3), pages 2113-2122.
    2. Dzhumashev Ratbek & Cooray Arusha, 2017. "The Feldstein-Horioka hypothesis revisited," The B.E. Journal of Macroeconomics, De Gruyter, vol. 17(1), pages 1-30, January.

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