Table 1 Panel unit root tests
Variable | CD test | Panel unit test, constant and linear time trend, Ho, pp. unit root, levels | Panel unit test, constant and linear time trend, Ho, pp. unit root, differences (growths) | ||
|---|---|---|---|---|---|
Im et al. (2003) | Fisher z (Choi 2001) | Im et al. (2003) | Fisher z (Choi 2001) | ||
Total social expenditure | 30.59 (0.000) | 1.696 (0.955) | 1.987 (0.976) | − 2.758*** (0.003) | − 2.716*** (0.003) |
Education expenditure | 27.58 (0.000) | 1.768 (0.961) | 2.253 (0.987) | − 7.135*** (0.000) | − 8.156*** (0.000) |
Health expenditure | 22.42 (0.000) | 0.951 (0.823) | 1.404 (0.919) | − 7.820*** (0.000) | − 8.862*** (0.000) |
Social security expenditure | 16.96 (0.000) | 0.264 (0.604) | 0.842 (0.800) | − 5.243*** (0.000) | − 5.695*** (0.000) |
Per capita income (logged) | 46.40 (0.000) | 1.662 (0.952) | 2.561 (0.995) | − 7.265*** (0.000) | − 8.243*** (0.000) |
Tax burden | 28.73 (0.000) | − 0.748 0.227 | − 0.339 (0.367) | − 7.257*** (0.000) | − 8.101*** (0.000) |
Trade (% of GDP) | 22.57 (0.000) | 0.766 (0.778) | 1.469 (0.929) | − 6.810*** (0.000) | − 7.787*** (0.000) |
Foreign direct investment inflows (%GNI) | 14.00 (0.000) | − 0.447 (0.327) | − 0.078 (0.469) | − 12.351*** (0.000) | − 13.722*** (0.000) |
External debt (%GNI) | 16.45 (0.000) | 0.166 (0.566) | 0.265 (0.605) | − 7.594*** (0.000) | − 8.663*** (0.000) |
Interest payments on debt | 20.42 (0.000) | − 1.092 (0.137) | − 0.571 (0.284) | − 10.520*** (0.000) | − 11.737*** (0.000) |
Unemployment | 8.24 (0.000) | 0.430 (0.666) | 0.458 (0.676) | − 8.029*** (0.000) | − 3.500*** (0.000) |
Population over 65/total | 55.13 (0.000) | 2.839 (0.997) | 1.429 (0.923) | − 1.406* (0.079) | − 1.397* (0.082) |
Democracy | − 5.129*** (0.000) | − 4.667*** (0.000) | |||
(0.994) | (0.998) | ||||
Right-wing party dummy | 2.042 (0.979) | 2.460 (0.993) | − 4.694*** (0.000) | − 5.139*** (0.000) | |