Table 2.

Interaction analysis results

Dependent variable: Local currency debt (expressed as a share of total external debt), Hausmann transformation
Independent variables	(1)	(2)	(3)	(4)	(5)	(6)	(7)
Lagged dependent variable	0.535***	0.487***	0.460***	0.506***	0.317***	0.550**	0.386***
	5.07	6.37	6.14	5.54	3.22	7.00	6.18
Fx turnover	1.371*	21.028	1.831*	1.246*	− 9.727	1.003	0.760
	1.88	1.50	1.67	1.74	− 1.50	0.22	1.50
Economic size	1.365*	1.306***	− 20.277*	− 1.564	− 3.026**	− 1.895	− 2.821
	1.72	2.37	− 1.83	− 0.84	− 2.04	− 0.89	− 1.13
Trade openess	− 0.024	0.049**	− 0.035	− 0.042	0.011	− 0.013	− 0.000
	− 1.58	2.16	− 0.84	− 1.39	0.41	− 1.26	− 0.03
Financial depth	0.010**	0.040**	0.021**	0.021***	0.042**	0.026*	0.030***
	2.32	2.19	3.14	3.43	2.15	1.72	3.05
Capital account openess	− 57.070
	− 0.89
FX volatility	− 0.106
	− 0.14
Current account	0.034**	− 0.024	0.030*	0.034**	− 0.012	0.036	0.002
	1.98	− 0.09	1.87	2.17	− 0.65	1.41	0.15
VIX	− 0.006***	− 0.002*	− 0.003**	− 0.003**	− 0.003***	− 0.007***	− 0.002*
	− 3.99	− 1.86	− 2.36	− 2.01	− 2.40	− 2.48	− 1.79
Governance	0.225	− 0.162	0.245	1.414*	− 0.006	− 0.612	− 1.147
	1.53	− 0.42	0.69	1.82	− 0.04	− 0.64	− 0.85
Fx turnover2		− 128.37
		− 1.40
Economic size2			25.247*
			1.74
Governance2				1.850
				1.04
Fxturnover*Economic size					24.023*
					1.54
Fxturnover*Governance						8.760**
						1.98
Economic size*Governance							4.578*
							1.69
Country specific effects	yes	yes	yes	yes	yes	yes	yes
CD test statistics	2.93	3.71	1.67	0.35	2.10	2.82	1.01
p-value	0.034	0.000	0.009	0.723	0.035	0.004	0.311
Number of obs	588	588	576	588	576	576	576
R2 adjusted	0.69	0.67	0.75	0.80	0.42	0.49	0.50
F-test	F(204,384) prob > F = 0.00	F(192,396) prob > F = 0.00	F(216,360) prob > F = 0.00	F(192,396) prob > F = 0.00	F(312,264) prob > F = 0.00	F(264,312) prob > F = 0.00	F(264,312) prob > F = 0.00

z-stats are in italics

*significant at 10%, **significant at 5%, ***significant at 1%

Countries included are Argentina, Brazil, Chile, Colombia, Mexico, Peru, India, Indonesia, Thailand, South Korea, South Africa, Turkey

Dynamic Common Correlated Effects with heterogenous coefficients. Constant not reported