Investment and Saving Relationship in South Asia


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Abstract

This study tests the Feldstein and Horioka hypothesis (1980) for four South Asian developing economies and an oil producing economy, Saudi Arabia. Performing cointegration tests on annual data, the results indicate that approximately one to one long run relationship between investment and saving is present in India and Saudi Arabia thus validating the above hypothesis while a weak form relation for Bangladesh, Pakistan, and Sri Lanka shows the existence of Feldstein and Horioka puzzle.Keywords: Saving-investment, cointegration, South AsiaJEL Classifications: C32; E21; F41

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Author Biography

Shabbir Ahmad, Effat University, Jeddah, KSA

Finance Department, College of Business, Effat University, Jeddah, KSA Assistant Professor

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Published

2017-09-12

How to Cite

Ahmad, S. (2017). Investment and Saving Relationship in South Asia. International Journal of Economics and Financial Issues, 7(4), 726–729. Retrieved from https://econjournals.com/index.php/ijefi/article/view/4087

Issue

Vol. 7 No. 4 (2017)

Section

Articles