Theoretical and Applied Economics
No. 2 / 2016 (607), Summer
Testing the validity of the Feldstein-Horioka Puzzle: New evidence from structural breaks for Turkey
Erciyes University, Turkey
Ahmet KOSEOGLU
Erciyes University, Turkey
Ali Gokhan YUCEL
Erciyes University, Turkey
Abstract. The purpose of this study is to test the validity of Feldstein-Horioka Puzzle using time series data covering the period of 1960-2014 for Turkey. In order to test this relationship, the recently proposed multiple-break cointegration test of Maki (2012) was employed. After detecting the existence of a cointegration between domestic saving by allowing for endogenous structural breaks, Fully Modified Ordinary Least Squares (FMOLS) and Dynamic Ordinary Least Squares (DOLS) estimation procedures are used to obtain long run coefficients. The empirical results indicate that the saving retention coefficient is equal to 0,377 and 0,406 in the DOLS and FMOLS for Turkish economy, respectively. These results imply relatively high capital mobility in Turkey.
Contents
The prerequisites of social development when planning for decentralization
Testing the validity of the Feldstein-Horioka Puzzle: New evidence from structural breaks for Turkey
The role of institutional pressures in developing countries. Implications for IFRS
Children’s health insurance coverage in the United States: The role of parents’ ethnicity and immigration status
Axiomatical examination of the neoclassical economic model. Logical assessment of the assumptions of neoclassical economic model
An empirical investigation of banking sector development and economic growth in a panel of selected SAARC countries
A common agency within bureaucracy
From public services to networks of social enterprises. Strategic trends for South-Eastern Europe
The relationship between inclusive growth, inequality and poverty in Africa
Investigation of relation between foreign portfolio investments and stock prices: Time varying asymmetric causality analysis
Asymmetric stochastic volatility in central and eastern European stock markets
Bankruptcy prediction based on the debt ratio
The effects of saving-investment gap on economic growth in developing countries: A clustering and panel data analysis
Impact of educational expenditure on economic growth in major Asian countries: Evidence from econometric analysis
Developing a financial inclusion index and inclusive growth in India
A comprehensive view on the manifestations of aggregate demand and aggregate supply shocks in Greece, Ireland, Italy and Portugal
Examining the determinants of FDI inflows in India
A review of corruption based on the social and economic evolution of Ancient Greece and Ancient Rome
Estimating the exchange rate in the context of Romania's integration in the Eurozone