Results of the evaluation test and the estimated threshold
| LM test | Newly democratic African countries | Newly democratic European countries | ||
|---|---|---|---|---|
| Macroprudential policy regime | Nonprudential policy regime | Macroprudential policy regime | Nonprudential policy regime | |
| Parameter constancy test | ||||
| LMF | 5.982 (4.873e–04) | 1.998 (2.889e–05) | 8.917 (15.098e–17) | 7.987 (0.0000) |
| LMχ | 40.712(3.223e–10) | 60.948 (4.341e–09) | 80.734 (8.932e–08) | 50.253 (0.000) |
| No remaining nonlinearity | ||||
| WB | 1 (p-value) | 1 (p-value) | 1 (p-value) | 1 (p-value) |
| WCB | 1 (p-value) | 1 (p-value) | 1 (p-value) | 1 (p-value) |
| Results of the estimated threshold for all models | ||||
| c | 65.00*** (5.93) | 50.00*** (10.01) | 72.00*** (11.81) | 60.01*** (3.11) |
| γ | 15.12*** (4.40) | 18.01*** (5.92) | 10.13*** (5.92) | 14.09*** (8.22) |
| LM test | Newly democratic African countries | Newly democratic European countries | ||
|---|---|---|---|---|
| Macroprudential policy regime | Nonprudential policy regime | Macroprudential policy regime | Nonprudential policy regime | |
| 5.982 (4.873e–04) | 1.998 (2.889e–05) | 8.917 (15.098e–17) | 7.987 (0.0000) | |
| 40.712(3.223e–10) | 60.948 (4.341e–09) | 80.734 (8.932e–08) | 50.253 (0.000) | |
| 1 ( | 1 ( | 1 ( | 1 ( | |
| 1 ( | 1 ( | 1 ( | 1 ( | |
| c | 65.00 | 50.00 | 72.00 | 60.01 |
| γ | 15.12 | 18.01 | 10.13 | 14.09 |
Notes:
Growth is the dependent variable, whereas government spending is the independent variable.
***Signify the level of significance of 1%
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