228
Views
1
CrossRef citations to date
0
Altmetric
Articles

Testing for the Feldstein-Horioka hypothesis in Asia using wavelet analysis

, ORCID Icon &
 

ABSTRACT

We investigate the Feldstein-Horioka (1980) puzzle using a novel time-frequency approach. The wavelet-based retention and correlation coefficients are estimated for a cross-section of 15 Asian countries over the period 1972–2016. The countries are grouped as OCED countries (Japan and South Korea), least developed countries (like Bangladesh and Nepal), the large countries (like India and China), and the small countries (like Sri Lanka and Pakistan). Our approach reveals some interesting insights on the relationship between investment and saving rates and investment and current account deficits.

JEL CLASSIFICATION:

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1 The puzzle was first documented by Martin Feldstein and Charles Harioka in 1980 and is considered as one of the major six puzzles in macroeconomics.

2 For an excellent literature review, please refer to Tesar (Citation1991).

3 For all the estimations MATLAB 2017b has been used.

Reprints and Corporate Permissions

Please note: Selecting permissions does not provide access to the full text of the article, please see our help page How do I view content?

To request a reprint or corporate permissions for this article, please click on the relevant link below:

Academic Permissions

Please note: Selecting permissions does not provide access to the full text of the article, please see our help page How do I view content?

Obtain permissions instantly via Rightslink by clicking on the button below:

If you are unable to obtain permissions via Rightslink, please complete and submit this Permissions form. For more information, please visit our Permissions help page.