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The long-run relationship between private and public savings: An empirical note

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  • Abir Mandal
  • James Payne

Abstract

This empirical note extends the recent work by Holmes (2006) in examining the long-run relationship between private and public savings in the U.S. over the post-World War II period. Standard Engle-Granger cointegration tests fail to reject the null hypothesis of no cointegration; however, once allowance is made for an endogenous break in the cointegrating relationship, the weak form of the Ricardian equivalence proposition is supported. Copyright Springer 2007

Suggested Citation

  • Abir Mandal & James Payne, 2007. "The long-run relationship between private and public savings: An empirical note," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 31(1), pages 99-103, March.
    • Handle: RePEc:spr:jecfin:v:31:y:2007:i:1:p:99-103
    DOI: 10.1007/BF02751515
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    References listed on IDEAS

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    1. Mark Holmes, 2006. "To what extent are public savings offset by private savings in the OECD?," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 30(3), pages 285-296, September.
    2. Norman Loayza & Klaus Schmidt-Hebbel & Luis Servén, 2000. "What Drives Private Saving Across the World?," The Review of Economics and Statistics, MIT Press, vol. 82(2), pages 165-181, May.
    3. J. Humberto Lopez & K. Schmidt-Hebbel & Luis Servén, 2000. "How Effective is Fiscal Policy in Raising National Saving?," The Review of Economics and Statistics, MIT Press, vol. 82(2), pages 226-238, May.
    4. Perron, Pierre, 1997. "Further evidence on breaking trend functions in macroeconomic variables," Journal of Econometrics, Elsevier, vol. 80(2), pages 355-385, October.
    5. Cristina Ruza & Jose Montero, 2003. "Empirical analysis of savings behavior in European countries: New insights," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 9(4), pages 279-287, November.
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    Cited by:

    1. Philippe Aghion & Matias Braun & Johannes Fedderke, 2008. "Competition and productivity growth in South Africa," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 16(4), pages 741-768, October.
    2. Daniel Choi & Mark Holmes, 2014. "Budget deficits and real interest rates: a regime-switching reflection on Ricardian Equivalence," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 38(1), pages 71-83, January.
    3. Lumengo Bonga-Bonga, 2008. "National Saving and Fiscal Policy in South Africa: an Empirical Analysis Sector in South Africa," Working Papers 084, Economic Research Southern Africa.

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