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Capital Formation in Thailand: Its Importance and Determinants

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  • Jiranyakul, Komain

Abstract

Using the dataset that comprises annual data during 1979 and 2012 and obtained from various sources, this study examines the importance of capital formation to Thai economy and what driving forces influence capital formation. The results show that real GDP and capital formation are cointegrated, and capital formation imposes a positive impact on real GDP in the long run. It is found that stock market liquidity measured by stock market capitalization rather than foreign direct investment plays important role in capital accumulation process. These findings give some policy implications.

Suggested Citation

  • Jiranyakul, Komain, 2014. "Capital Formation in Thailand: Its Importance and Determinants," MPRA Paper 58442, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:58442
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    References listed on IDEAS

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    3. Joshua Greene & Delano Villanueva, 1991. "Private Investment in Developing Countries: An Empirical Analysis," IMF Staff Papers, Palgrave Macmillan, vol. 38(1), pages 33-58, March.
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    More about this item

    Keywords

    Capital formation; economic growth; stock market capitalization; bounds testing.;

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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