Consumption, Income, and International Capital Market Integration
AbstractThis paper uses consumption patterns across countries to measure capital market integration. It argues that earlier empirical tests of this type were potentially mis-specified and proposes a more robust specification. The results indicate that Japan was the only industrialized country for which national consumption was fully integrated with the rest of the world over the period 197389. For the other countries the source of the failure varies. Within the European Union it is generally associated with incomplete integration across capital markets. Elsewhere, consumption is found to be excessively dependent on disposable income.
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Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 1028.
Date of creation: Oct 1994
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Other versions of this item:
- Tamim Bayoumi & Ronald Macdonald, 1995. "Consumption, Income, and International Capital Market Integration," IMF Staff Papers, Palgrave Macmillan, vol. 42(3), pages 552-576, September.
- Ronald MacDonald & Tamim Bayoumi, 1994. "Consumption, Income, and International Capital Market Integration," IMF Working Papers 94/120, International Monetary Fund.
- E21 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
- F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
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