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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:Saving, Investment and Capital Mobility in African Countries
Authors:Adedeji, Olumuyiwa S.ISNI
Thornton, JohnISNI
Year:2007
Periodical:Journal of African Economies
Volume:16
Issue:3
Pages:393-405
Language:English
Geographic terms:Cameroon
Gabon
Ghana
Nigeria
South Africa
Zimbabwe
Africa
Subjects:capital movements
savings
investments
Development and Technology
Economics and Trade
History and Exploration
External link:https://jae.oxfordjournals.org/content/16/3/393.full.pdf
Abstract:Recently developed panel cointegration techniques are applied to data for six African countries - Cameroon, Gabon, Ghana, Nigeria, South Africa and Zimbabwe - to test the Feldstein-Horioka approach to measuring capital mobility. The results suggest three conclusions: savings and investment in panel data are non-stationary series and they are cointegrated; capital was relatively mobile in the African countries during 1970-2000, with estimated savings-retention ratios of 0.73 (fully modified ordinary least squares or FMOLS), 0.45 (dynamic ordinary least squares or DOLS), 0.51 (DOLS with heterogeneity) and 0.39 (DOLS with cross-sectional dependence effects); and there was a marked drop in the savings-retention ratio from 1970-1985 to 1986-2000. The results could be interpreted as indicating that capital mobility in African countries has increased, reflecting the implementation of market-orientated reforms, including the privatization and rationalization of the public sector, and the partial liberalization of their exchange rate regimes and financial systems. Bibliogr., notes, ref., sum. [Journal abstract]
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