Discretionary government consumption, private domestic demand, and crisis episodes
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 ove...
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| Other Authors: | , |
| Format: | article |
| Language: | eng |
| Published: |
2013
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| Subjects: | |
| Online Access: | http://hdl.handle.net/1822/21355 |
| Country: | Portugal |
| Oai: | oai:repositorium.sdum.uminho.pt:1822/21355 |
| Summary: | 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 mediumterm crowding out effects are amplified once we control for periods of crisis. |
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