Comparing Capital Mobility Across Provincial and National Borders

18 Pages Posted: 25 Jul 2000 Last revised: 10 Oct 2010

See all articles by John F. Helliwell

John F. Helliwell

University of British Columbia (UBC) - Department of Economics; National Bureau of Economic Research (NBER)

Ross McKitrick

University of Guelph - Department of Economics

Date Written: June 1998

Abstract

The persistence of high savings-investment correlations and home-country bias in portfolio construction at the national level is contrasted with new evidence of savings behaviour in Canadian provinces. We confirm that national borders clearly divert flows of capital to domestic investments, but provincial borders have no such effect. In particular, while there is a significant correlation between national savings and investment, among provinces that effect disappears. We discuss the implications for interpreting the distinction between provincial and national borders.

Suggested Citation

Helliwell, John F. and McKitrick, Ross, Comparing Capital Mobility Across Provincial and National Borders (June 1998). NBER Working Paper No. w6624. Available at SSRN: https://ssrn.com/abstract=226342

John F. Helliwell (Contact Author)

University of British Columbia (UBC) - Department of Economics ( email )

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Ross McKitrick

University of Guelph - Department of Economics ( email )

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