Discretionary Government Consumption, Private Domestic Demand, and Crisis Episodes

Open Economies Review - Tập 24 - Trang 79-100 - 2012
Luca Agnello1,2, Davide Furceri3,2, Ricardo M. Sousa4,5
1Banque de France, Service d’Etude des Politiques de Finances Publiques (FIPU), Paris, France
2Department of Economics, Business and Finance, University of Palermo, Palermo, Italy
3International Monetary Fund, Washington, USA
4Department of Economics and Financial Markets Group (FMG), London School of Economics, London, UK
5Department of Economics and Economic Policies Research Unit (NIPE), University of Minho, Braga, Portugal

Tóm tắt

This paper analyzes the dynamic impact of discretionary government consumption purchases on private demand. Using a panel of 132 countries from 1960 to 2008, we find that while discretionary changes in government consumption lead to crowding-in effects in the short run, crowding-out effects take over in the medium run. In addition, we also find that both short-term crowding-in and medium-term crowding out effects are amplified once we control for periods of crisis.

Tài liệu tham khảo

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