Table 8.
Short and Long Run Results using Regulatory Quality.
| Variable | Spec 7(IQ = REQ) |
Spec 8(IQ = REQ) |
||
|---|---|---|---|---|
| Coeff. | t-Stat | Coeff. | t-Stat | |
| Short-Run Coefficients | ||||
| ECM (−1) | −0.786*** | −6.681 | −0.762*** | −6.477 |
| ΔLNDEBT | 0.330*** | 5.664 | 0.349** | 4.756 |
| ΔIQ | 1.024* | 3.001 | 1.332*** | 8.777 |
| Δ(LNDEBT × IQ) | 0.678*** | 4.556 | ||
| ΔLNTFP | 1.001*** | 4.962 | 0.782* | 2.569 |
| ΔLNINF | −0.198*** | −5.456 | −0.221 | −2.762 |
| ΔLNGS | 0.386** | 3.680 | −0.246 | −0.967 |
| ΔLNEXP | 0.092*** | 6.943 | ||
| C | 4.882*** | 5.042 | −5.833** | −4.332 |
| Long-Run Coefficients | ||||
| LNDEBT | −0.341*** | −6.687 | −0.308** | −3.981 |
| IQ | 1.022*** | 5.453 | 1.223*** | 5.782 |
| LNDEBT × IQ | 0.827** | 4.661 | ||
| TFP | 0.998** | 4.072 | 0.991 | 0.784 |
| LNINF | −0.302** | −4.602 | −0.260 | −2.691 |
| GS | 0.121** | −4.673 | −0.096* | −2.609 |
| LNEXP | 0.340*** | 6.674 | 0.456*** | 5.321 |
| C | 5.990*** | 6.839 | 5.833* | 3.229 |
Notes: Spec. Is the short form of specification and coeff. represents the coefficient. Δ is the first difference, whereas C is the constant term. *, ** and *** represents the significance at 10%, 5% and 1% respectively.