The Feldstein-Horioka Puzzle Revisited: An “European-Regional” Perspective
AbstractThe purpose of this paper consists in assessing the extent of financial integration in European Union using the Feldstein-Horioka criterion. More precisely, we test the cross-correlation of savings and investment rates across European Union regions, using NUTS 2 data coming from Eurostat regional database, over the period 1995-2000. Several important outcomes are reported by our article: if financial integration seems to be realized across all the regions forming European Union, the Feldstein-Horioka criterion keeps emphasizing differences between small and big countries, the later being less integrated at the regional level. Furthermore, the testing of the relationship between savings and investment in consistent sub-groups of regions (designed according to geographical, historical or economic criteria) emphasize that financial integration can be higher at the regional level.
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Bibliographic InfoPaper provided by William Davidson Institute at the University of Michigan in its series William Davidson Institute Working Papers Series with number wp763.
Date of creation: 01 Mar 2000
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regional savings; investment; capital market; capital flows;
Find related papers by JEL classification:
- E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Capital; Investment; Capacity
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
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- Ricardo Bebczuk & Klaus Schmidt-Hebbel, 2010.
"Revisiting the Feldstein-Horioka Puzzle: An institutional sector view,"
Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata, vol. 0, pages 69-104, January-D.
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