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    European integration and the Feldstein-Horioka Puzzle

    Katsimi, M. and Zoega, Gylfi (2014) European integration and the Feldstein-Horioka Puzzle. Working Paper. Birkbeck College, University of London, London, UK.

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    Abstract

    We estimate the Feldstein-Horioka equation for the period 1960-2012 and find structural breaks that coincide with the introduction of the European single market in 1993, the introduction of the euro in 1999 and the financial crisis in 2008. The results suggest that the correlation between investment and savings depends on institutions, exchange rate risk and credit risk. Furthermore, we find that the pattern of capital flows within the euro zone reflect differences in output per capita, the rate of growth of output per capita and budget balances.

    Metadata

    Item Type: Monograph (Working Paper)
    Additional Information: ISSN 1745-8587: BWPEF 1410
    Keyword(s) / Subject(s): Feldstein-Horioka puzzle, European integration
    School: Birkbeck Schools and Departments > School of Business, Economics & Informatics > Economics, Mathematics and Statistics
    Research Centre: Applied Macroeconomics, Birkbeck Centre for
    Depositing User: Administrator
    Date Deposited: 20 May 2016 13:55
    Last Modified: 07 Dec 2016 14:54
    URI: http://eprints.bbk.ac.uk/id/eprint/15289

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