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الإنفاق العمومي والإستثمار الخاص اختبار أثر المزاحمة عبر المعاينة المعادة
[Public Spending and Private Investment: Test of Crowding-out Effects through Re-sampling]

Author

Listed:
  • Ghassan, Hassan B.

Abstract

The purpose of this research is to test and evaluate the crowding-out effect of the investment expenditure in public sector on the investment effort by private sector by using data from Moroccan Economy. After the theoretical background of crowding-out effects in many domains of investment, we introduce the interests variables which express the budget policy of a government and monetary policy of the central bank, and shows the global effective demand addressed to economy. This requires the improvement of a likelihood private investment model and the specification of its shape from a Box-Cox transformation by using the weight average test LM. It has become clear that in the long run term the push effect dominates the crowding-out effect and this leads to a little increase in the elasticity of private investment reaches 0.06%. We have used the bootstrapping methodology to check the signs and the values of crowding-out parameters. Among the main causes which explain this small effect are the investors’ behaviour and their reactions vis-à-vis the real economic data and growth expectation, the nature of national and foreign markets of products and their competitiveness, and the nature and situation of finance market and banks, which has put, some extent, Moroccan economy into a “trap of liquidity” especially during the last few years.

Suggested Citation

  • Ghassan, Hassan B., 2002. "الإنفاق العمومي والإستثمار الخاص اختبار أثر المزاحمة عبر المعاينة المعادة
    [Public Spending and Private Investment: Test of Crowding-out Effects through Re-sampling]
    ," MPRA Paper 56381, University Library of Munich, Germany, revised 03 Dec 2002.
  • Handle: RePEc:pra:mprapa:56381
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    References listed on IDEAS

    as
    1. Isabel Argimon & Jose Gonzalez-Paramo & Jose Roldan, 1997. "Evidence of public spending crowding-out from a panel of OECD countries," Applied Economics, Taylor & Francis Journals, vol. 29(8), pages 1001-1010.
    2. H. Ahmed & SM. Miller, 2000. "Crowding-out and crowding-in effects of the components of government expenditure," Contemporary Economic Policy, Western Economic Association International, vol. 18(1), pages 124-133, January.
    3. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    4. Davidson, Russell & MacKinnon, James G, 1987. "Implicit Alternatives and the Local Power of Test Statistics," Econometrica, Econometric Society, vol. 55(6), pages 1305-1329, November.
    5. Perron, Pierre & Rodriguez, Gabriel, 2003. "GLS detrending, efficient unit root tests and structural change," Journal of Econometrics, Elsevier, vol. 115(1), pages 1-27, July.
    6. Lutkepohl, Helmut & Reimers, Hans-Eggert, 1992. "Granger-causality in cointegrated VAR processes The case of the term structure," Economics Letters, Elsevier, vol. 40(3), pages 263-268, November.
    7. Russell Davidson & James MacKinnon, 2000. "Bootstrap tests: how many bootstraps?," Econometric Reviews, Taylor & Francis Journals, vol. 19(1), pages 55-68.
    8. Christophe Hurlin, 1999. "La contribution du capital public à la productivité des facteurs privés : une estimation sur panel sectoriel pour dix pays de l'OCDE," Économie et Prévision, Programme National Persée, vol. 137(1), pages 49-65.
    9. Ghassan, Hassan B., 2003. "Relations de Long Terme entre Investissement, Déficit Extérieur et Autofinancement sur un Panel Sectoriel
      [Long Run Relationships between Investment, Trade Deficit and Cash-Flow: Evidence from Sect
      ," MPRA Paper 56423, University Library of Munich, Germany, revised 10 Sep 2003.
    10. Mario I. Blejer & Mohsin S. Khan, 1984. "Government Policy and Private Investment in Developing Countries (Politique des pouvoirs publics et investissement privé dans les pays en développement) (Política estatal e inversión privada en lo," IMF Staff Papers, Palgrave Macmillan, vol. 31(2), pages 379-403, June.
    11. Aschauer, David Alan, 1989. "Does public capital crowd out private capital?," Journal of Monetary Economics, Elsevier, vol. 24(2), pages 171-188, September.
    12. Erenburg, S. J. & Wohar, Mark E., 1995. "Public and private investment: Are there causal linkages?," Journal of Macroeconomics, Elsevier, vol. 17(1), pages 1-30.
    13. Voss, Graham M., 2002. "Public and private investment in the United States and Canada," Economic Modelling, Elsevier, vol. 19(4), pages 641-664, August.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Public Investment; Private Investment; Crowding-out; Box-Cox; Bootstrapping; Morocco.;

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • H5 - Public Economics - - National Government Expenditures and Related Policies
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures

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