What does the saving-investment (SI) relation really measure and how should the SI relation be measured? These are two of the most discussed issues triggered by the so-called Feldstein-Horioka puzzle. Based on panel data we introduce a new variant of functional coefficient models that allows to...

We investigate for 26 OECD economies whether their current account imbalances to GDP are driven by stochastic trends. Regarding bounded stationarity as the more natural counterpart of sustainability, results from Phillips-Perron tests for unit root and bounded unit root processes are contrasted....

The Feldstein-Horioka puzzle has triggered a broad range of econometric specifications to investigate saving-investment (SI) relations. In this article, we attempt to determine a family of econometric models that is most suitable in explaining actual ratios of domestic investment to GDP via...

To infer on functional dependence of regression parameters, a new, factor based bootstrap approach is introduced that is robust under various forms of heteroskedastic error terms. Modeling the functional coefficient parametrically, the bootstrap approximation of an F-statistic is shown to hold...

What does the saving-investment (SI) relation really measure and how should the SI relation be measured? These are two of the most discussed issues triggered by the so called Feldstein-Horioka puzzle. Based on panel data we introduce a new variant of functional coefficient models that allows to...

We investigate for 26 OECD economies if their current account imbalances are driven by stochastic trends. Standard ADF results are contrasted with tests accounting for the bounded support of the current account. Neglecting the latter feature might give misleading results in the sense that ADF...

What does the saving-investment (SI) relation really measure and how should the (SI) relation be measured? These are two of the most discussed issues triggered by the so called Feldstein-Horioka puzzle. Based on panel data we introduce a new variant of functional coefficient models that allow to...