Long-Term Capital Movements



32

Table 2. Determinants of net foreign assets, industrial countries
Panel DOLS regressions with fixed time and country effects

(1)

(2)

(3)

(4)

(5)

CUMCA

1970-98

CUMCA

1980-98

CUMCA+IIP

1970-98

CUMCA+IIP

1980-98

CUMCA
Balanced
1972-97

Log GDP per capita

0.91

(12.63)**

0.91
(7.26)**

0.9
(12.55)**

0.89
(6.71)**

0.94
(11.66)**

Public Debt

-0.125

(3.1)**

-0.05
(0.9)

-0.124
(3.01)**

-0.07

(1.1)

-0.18

(4.54)**

χ2 (Demog.)

30.1
(0.00)**

2.3
(0.51)

22.1
(0.00)**

4.2
(0.24)

43.6
(0.00)**

Adjusted R2

0.89

0.91

0.89

0.93

0.9

Observations

516

389

516

382

390

Countries

22

22

22

22

15

α (POP<15)

-1.47

-0.81

-1.24

-1.2

-2.26

α (POP>64)

-0.66

-0.59

-1.29

-0.44

-0.05

α max

1.41
(50-54)

0.46
(35-39)

1.24
(50-54)

0.63
(30-34)

1.24
(50-54)

α min

-1.49
(15-19)

-0.81

(0-14)

-1.29
(15-19)

-1.2
(0-14)

-2.26

(0-14)

* Dynamic ordinary least squares, t-statistics in parentheses (р-value for the χ2 (Demog.) statistic). * (**)
indicates statistical significance at the 5% (1%) confidence level. In regressions (1) and (2) the dependent
variable is CUMCA for all countries except Belgium, for which it is the IIP estimate of net foreign assets minus
gold. In regression (3) the dependent variable is the IIP estimate of NFA for Belgium, Canada, Italy, Japan and
United Kingdom, and CUMCA for all other countries. In regression (4) it is the IIP estimate of NFA for
Austria, Belgium, Canada, Finland, Germany, Italy, Japan, Netherlands, Spain, Sweden, Switzerland, United
Kingdom and United States and CUMCA for the remaining countries.



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