Crowding-out and crowding-in effects of the components of government expenditure

Ahmed, Habib; Miller, Stephen M.

Abstract

This article examines the effects of disaggregated government expenditure on investment using fixed- and random-effect methods. Using the government budget constraint, the analysis explores the effects of tax- and debt-financed expenditure for the full sample, and for subsamples of developed and developing countries. In general, tax-financed government expenditure crowds out more investment than debt-financed expenditure. Expenditure on social security and welfare reduces investment in all samples while expenditure on transport and communication induces private investment in developing countries.

Citation

Ahmed, H., & Miller, S. M. (2000). Crowding-out and crowding-in effects of the components of government expenditure. Contemporary Economic Policy, 18(1), 124-133. https://doi.org/10.1111/j.1465-7287.2000.tb00011.x

• Journal Article Type: Article
• Publication Date: Jan 1, 2000
• Deposit Date: Feb 3, 2011
• Journal: Contemporary Economic Policy
• Print ISSN: 1074-3529
• Electronic ISSN: 1465-7287
• Publisher: Wiley
• Peer Reviewed: Peer Reviewed
• Volume: 18
• Issue: 1
• Pages: 124-133
• DOI: https://doi.org/10.1111/j.1465-7287.2000.tb00011.x
• Public URL: https://durham-repository.worktribe.com/output/1544212