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Is Taiwan’s Declining Public Investment a Crisis in the Making?

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  • Chen, Chien-Hsun

Abstract

Taiwan’s economic transformation has been a cause for concern in recent years with the latest data indicating a slower expansion of fixed capital formation, a crucial factor for both domestic demand and economic growth. A crucial contributor is the shift in government spending in favor of welfare spending and away from public investment to comply with voters’ preference for low taxes and high government spending during elections. Since public investments in infrastructure are debt-financed, the accumulation of government debt could lead to slower economic growth and an increasingly heavy tax burden for future generations.

Suggested Citation

  • Chen, Chien-Hsun, 2023. "Is Taiwan’s Declining Public Investment a Crisis in the Making?," MPRA Paper 116513, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:116513
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    File URL: https://mpra.ub.uni-muenchen.de/116513/1/MPRA_paper_116513.pdf
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • H0 - Public Economics - - General
    • H00 - Public Economics - - General - - - General
    • H1 - Public Economics - - Structure and Scope of Government

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