Abstracts

DOIhttp://doi.org/10.1111/1468-0084.00213
Publication Date01 May 2001
OXFORD BULLETIN
of
ECONOMICS and STATISTICS
Volume 63 May 2001 No. 2
OXFORD BULLETIN OF ECONOMICS AND STATISTICS, 63, 2 (2001)
Abstracts
Causality Tests for Cross-Country Panels: A New Look at FDI and
Economic Growth in Developing Countries
Usha Nair-Reichert and Diana Weinhold
The remarkable increase in FDI ¯ows to developing countries over the last
decade has focused attention on whether this source of ®nancing enhances
overall economic growth. We use a mixed ®xed and random (MFR) panel
data estimation method to allow for cross country heterogeneity in the causal
relationship between FDI and growth and contrast our ®ndings with those
from traditional approaches. We ®nd that the relationship between invest-
ment, both foreign and domestic, and economic growth in developing coun-
tries is highly heterogeneous and that estimation methods which assume
homogeneity across countries can yield misleading results. Our results sug-
gest there is some evidence that the ef®cacy of FDI in raising future growth
rates, although heterogeneous across countries, is higher in more open
economies.
Distortionary Taxation and Labour Market Performance
Riccardo Fiorito and Flavio Padrini
Quarterly estimates of consumption, capital and labour tax rates are provided
for six major OECD countries. We then use the `stylized facts' methodology
to evaluate the strength, sign and phase of cyclical comovements between tax
rates and labour market variables. Labour taxes distort labour market de-
#Blackwell Publishers Ltd, 2001. Published byBlackwell Publishers, 108 Cowley Road, Oxford OX4 1JF, UKand 350
Main Street, Malden, MA 02148, USA.
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