Effects Of Public Investment Research Articles

The Fiscal Multiplier of Public Investment: The Role of Corporate Balance Sheet

Abstract This paper explores whether public investment crowds out or crowds in private investment. To this aim, we build a database of about half a million firms from 49 countries. We find that the effect of public investment on corporate investment depends on leverage, liquidity constraint, and firm’s operating (labor) efficiency. In line with theory, public investment boosts private investment for firms with low leverage, but not for firms with high leverage, for firms that are financially constrained or that have low operating efficiency.

Effect of Public Investment on Health Population: A Review of BRICS Countries

This research aims to investigate the perspectives offered by the literature on health population in relation to public investment, Foreign Direct Investment, and Economics Policy Uncertainty in emerging nations. This paper explores and summarizes current theoretical and empirical studies on the issue. It begins by providing a summary of public investment, foreign direct investment, and HP in the BRICS nations. The literature is identified in a second way, utilizing conceptual and practical knowledge from published works. Furthermore, this paper clarified theoretical methodologies that describes how these strategies function. This work advances the fields of public investment, health population, foreign direct investment, and economic policy.

The Impact of Public Investment on Private Investment in Botswana: A Disaggregated Approach

The study examined the crowding in or out effect of public investment on private investment in Botswana from 1980 to 2018 using the autoregressive distributed lag bounds testing approach. The findings of the study indicate that infrastructure public investment negatively affects private investment while non-infrastructure public investment has a positive impact on private investment in the short run. The study concluded that infrastructure public investment crowd out private investment while non-infrastructure public investment crowds in private investment only in the short run. The recommendation emanating from the study is that the government should spend more on non-infrastructure public investment in order to crowd in private investment, especially in the short run, and introduce more initiatives to promote the role of the private sector in growing the economy.

Beyond Education Dollars: Does Social Safety Net Spending Affect High School Graduation Rates?

PurposeTo examine the relationship between social safety net (SSN) spending and high school graduation rates for all students, as well as students belonging to minoritized groups. Also, to determine whether public SSN investments and PK-12 education are independent. MethodsUsing Common Core Data and the State-by-State Spending on Kids data, we estimated the effects of per-child SSN spending on graduation rates over time (2010–2016) using two-way fixed effects. ResultsSSN spending positively impacts high school graduation rates, with slightly larger magnitudes for students belonging to minoritized groups. The effects of public investments in SSN health, and PK-12 education on high school graduation rates are independent. DiscussionOur results indicate that the positive effects of SSN spending on high school graduation rates are independent of any impacts associated with education spending, suggesting that these two types of public investments affect high school graduation through different pathways.

Https://journals.scholarpublishing.org/index.php/AIVP/article/view/13922

Land use system is the interface between society and the biophysical environment; it is concern how humans use ecosystems services provide by natural resources.  Land-use and land-cover changes have great effects for the environmental and socioeconomic sustainability of rural communities. A capacity for detecting and reporting land use change is critical to evaluating and monitoring trends in natural resource conditions and the effectiveness of public investment in their management. In Mexico, despite ongoing mapping land use - land cover efforts; there remains a need for development of basic datasets providing quantitative and spatial land use/land cover information, mainly a detailed scale. Recent availability of high-resolution satellite remote-sensing images coupling with advances digital image processing techniques offers an improved opportunity to map in a more detailed scale the land use  and land cover, which will be an important tool to monitor the environment at local scales. It is the objective of this study, conduct a detailed mapping of land use-land cover in  Usumacinta watershed, using high-resolution satellite images and analyze  changes occurred when  is compared with  National Institute of Statistic and geography map - Series VII,2016. The basis for the land use and vegetation cover presented in this study is the digital land cover and land use classification elaborated with SPOT imagery, spatial resolution 1.5 meters, using  an object-based classification method  in combination with an image classification based on expert knowledge. The resulting map was  updated using Sentinel images  2021 and 2022 , by means of on screen digital interpretation. The result is a detail map of land use land cover, where new classes were generated as association and consociation units. As a conclusion is established that the resulting map is more stable in time, and it can be used as indicative to implement restoration measures on natural vegetation and as input to calculate a more precise estimations of agriculture statistic’s. All of this aspects can guide the design and implementation of public policies about land use.

Public expenditure in education at all levels (primary, secondary, and higher) in Bhutan: A critical analysis

This critical analysis delves into the allocation and utilization of public expenditure in education across all levels in Bhutan, including primary, secondary, and higher education. The study aims to provide valuable insights into how public funds are distributed and used within Bhutan's education system. By conducting this analysis, we seek to identify strengths, weaknesses, and areas for improvement in education funding and policy-making to enhance the overall effectiveness of public investment in education for the betterment of Bhutan's educational system and its citizens. The research employs a secondary data research method, allowing for an in-depth analysis of extensive datasets without the need for primary data collection. This method ensures efficiency and enables researchers to gain valuable insights into the education system and its funding. In 2015, public expenditure on education accounted for 25.5% of the total government expenditure in Bhutan. This marked a substantial increase from the previous year's figure of 17%. This is a positive trend that indicates a growing commitment to education. Expenditure in primary education increased significantly, rising from 32% in the previous year to 57% in 2015. This highlights the government's emphasis on foundational education, which is crucial for building a strong educational base. Expenditure per student in secondary education showed fluctuations, with a figure of 53.9% in 2014. However, there was an overall upward trend in expenditure per student from 1971 to 2014. This suggests that while secondary education is receiving attention, there may be room for more consistent funding. Tertiary education received 10.3% of the expenditure in 2014, although there were fluctuations in funding over the years. Ensuring adequate funding for tertiary education is crucial, as it plays a vital role in producing a skilled workforce that can contribute significantly to the nation's development. The analysis reveals that public spending on education as a percentage of GDP experienced fluctuations, with some years witnessing significant increases or decreases. Consistent education funding is vital for Bhutan's socioeconomic progress. This analysis emphasizes the need for stable investment in primary, secondary, and tertiary education. It highlights the evolving budget priorities and underscores education's critical role in Bhutan's development. Policymakers should use these findings toensuresustained and balanced education investment forlong-termprosperity.

The Impact of Public Investment on Economic Growth in Pakistan

This paper explores the role of public investment in the process of economic growth, in the context of Pakistan’s economy, using the vector autoregressive approach (VAR). Based on theoretical considerations, the model also includes private investment and public consumption besides public investment. The results show that growth is largely driven by private investment and that no strong inference can be drawn from the effects of public investment and public consumption on economic growth. JEL Classification: E2, 04. Keywords: Public Investment, Economic Growth.

Is there a nonlinear relationship between public investment and private investment? Evidence from 21 Organization for Economic Cooperation and Development countries

AbstractThis paper studies the relationship between public investment and private investment in a sample of 21 Organization for Economic Cooperation and Development (OECD) countries between 2000 and 2019. Using panel data nonlinear threshold regression models, the empirical results show that there exist threshold levels for the share of public investment in private investment, the real Gross Domestic Product (GDP) growth rate and the real interest rate that affect the relationship between public and private investment. All estimates support a crowding‐in effect of public investment on private investment. In terms of policy prescriptions, by increasing public investment, OECD governments can expect positive spillovers to private investment.

The Effects of Public Investment on Sustainable Economic Growth: Empirical Evidence from Emerging Countries in Central and Eastern Europe

The relationship between sustainable growth and public investment, considered one of the key factors, is a topic of interest in the context of globally adopted sustainable development strategies and current budgetary constraints, especially in the case of tight budgets in developing countries, which constrain public investment more than current expenditure, for political or other reasons. Although there are endogenous growth patterns that incorporate public spending as a factor that promotes growth, the findings in the empirical literature provide contradictory results. The study is an empirical investigation into the effects of public investment on sustainable economic growth in emerging EU and Central European countries. For the period 1995–2019, the research shows that, in most of the countries included in the sample, the long-term impact of a public capital shock on GDP is estimated to be negative. The analysis of the effect of public investment on sustainable economic growth was performed by applying the VAR model and impulse response functions, the results being confirmed by estimating the accumulated multiplier to obtain the GDP response to a shock equal to a standard deviation of public capital.

Public expenditure for water facility and road transport infrastructure in Ethiopia: a comparison of impacts using an economy-wide model

BackgroundEthiopian government is investing in a wide range of pro-poor sectors but the economic effects of public investment widely vary across sectors. With a limited public resource, public investment across sectors has to be prioritized based on their potential socio-economic contributions and/or economy-wide benefits. Therefore, the objective of this study is to compare and explore the economy-wide returns of public expenditure on water facility and energy technology (such as improved cooking stoves) on the one hand and public expenditure on road infrastructure on the other hand.MethodsThe source of data for this study is the 2005/06 updated Social accounting matrix (SAM) of Ethiopia. The analysis applies the STAGE Computable General Equilibrium (CGE) model developed by McDonald (2007). This study analyses two policy scenarios; the first scenario is an increase in the total factor productivity (TFP) of water fetching and firewood collection activities due to public investment in water facility and improved cooking stoves and the second scenario is a decrease in the trade and transport margins due to public investment in road transport infrastructure. For ensuring the comparability of the return of public expenditure, the same amount of public capital is invested in both scenarios.ResultsThe simulation outcome indicates that public investment in water facility and improved stoves results relatively higher domestic production in most sectors, larger household consumption, improved household welfare and improve in the major macroeconomic indicators (GDP, absorption, private consumption, and total domestic production) as compared to public investment in road transport infrastructure.ConclusionsIt is conducive to explore the potential economic contribution of public expenditure across the different pro-poor sectors before launching public investment in any specific sector. This will ensure limited public budgets are appropriately invested in the sector that can bring relatively highest economic-wide benefits to the wider society.

External Debt, Public Investment and Economic Growth in Cameroon

This study investigates the extent to which external debt and public investment contribute to economic growth in Cameroon-emphasizing how public investment modulates the effect of external debt on economic growth. Time series data spanning the period 1980-2021 obtained from the World Bank’s world development indicators were used, together with the Dynamic Ordinary Least Squares (OLS) approach to ascertain the nature of the long-run relationship between external debt, public investment, and economic growth in Cameroon. Consistent with the debt-overhang and crowding-out literature, the study reveals a negative significant influence of external debt on economic growth in Cameroon. Results also reveal that there is a positive and significant direct effect of public investment on economic growth in the long run. Further results indicate that public investment and external debt positively and significantly affect engender economic growth in Cameroon. This is evidence that public investment modulates the effect of external debt on economic growth in Cameroon. These findings suggest the need for the government of Cameroon to create an enabling environment for private sector investment while accompanying external debt resources with domestic revenue mobilization by broadening the tax base to include taxes on landed property.

Simulating employment and fiscal effects of public investment in high-quality universal childcare in the UK

This paper simulates the likely fiscal and employment effects of a vast public annual investment programme of free universal high-quality early childhood education and care (ECEC) services in the UK. It examines the extent to which it would pay for itself fiscally for different scenarios of pay increases. Investing in high-quality universal ECEC benefits all children by improving their life chances, especially for those living in lower income families. It also generates larger employment effects than other more typical investment policies such as construction projects and fosters gender equality in employment: not only it provides many high-quality jobs for women, it also allows many mothers to improve their lifetime earnings prospects by freeing up their childcare constraints. This in turn has beneficial fiscal revenue effects for the government. Estimations of annual public expenditure for a system of highly qualified and well-paid childcare staff with low child-to-staff ratios are performed, with universal coverage for all pre-school children aged 6 months to 4.5 years. Labour demand and matching supply effects are also simulated using input–output methods, for different take-up rates of the programme. A microsimulation tool is used to calculate increases in household income and tax liabilities and decreases in social security benefits spending. This results in a net annual funding requirement of between 28 and 39% of the gross investment. Two funding methods are then explored: raising taxation in a progressive way and recouping the cost over time from persistent mothers’ increased earnings. The former would entail a net additional contribution by the richest 20% of households of at most 0.4% of their income; the latter would require 21 to 31 years to offset the programme on average, which is within a typical working life-course following a first child’s birth, of 35 years.

How the Crowding-out Effect Hypothesis Stands Under a Financial System Liberalised: The Mexican Economy Case

This paper revisits the financial-liberalisation hypothesis predicting one negative effect of public investment on private investment, which led to the de-regularisation of the financial system in Mexico and many other Less-developed Countries (LDCs) so as to probe whether such tenet hold today even when the role played by the public sector has evolved from having a direct intervention in credit allocation scheme to the fulfilment of a limited duties such as the surveillance of the money and capital markets under a financial liberalization environment. Considering Mexico as a case study, an econometric exercise over the 1970-2019 period is tried crunching official statistical data. Besides a brief introduction, the second section discusses theoretical issues concerning the effects of public investment on private investment, likewise some empirical work done in this field. The third section develops the methodology used to taste the net effect of public investment on private investment and presents also the results estimates. Finally, some conclusions derived from the empirical evidence found in the analysis and a brief discussion are laid down.

The Effect of Public Investments on Women’s Employment: Panel Regression Analysis in Regional Level for Turkey

Günümüzde beşeri sermaye faktörü içinde yer alan kadınların üretim süreçlerine dahil olması sürdürülebilir ekonomik büyüme politikalarının önemli bir bileşenini oluşturmaktadır. Gelişmiş ülkeler çalışma yaşamında cinsiyet eşitliğinin sağlanmasına yönelik politikalar uygulamaktadırlar. Çalışma yaşamındaki kadın istihdamı artışı gelişmişlik seviyelerine olumlu katkı sunarak ekonomik büyümeyi pozitif etkilemektedir. Dolayısıyla gelişmekte olan ülkeler de kadın istihdamını artırmaya yönelik politikalar oluşturmak ve uygulamak yönünde hareket etmektedirler. Böylelikle sürdürülebilir ekonomik büyümeye katkı sunmayı hedeflemektedirler. Kamu yatırımları ekonomik büyüme ve sosyal gelişime katkı sunma amaçları doğrultusunda hareket etmektedir. Bu bağlamda çalışmanın amacı Türkiye için bölgesel kamu yatırımlarının bölgesel kadın istihdamı üzerindeki etkisini araştırmaktır. Bölgesel kamu yatırımlarının bölgesel kadın istihdamı üzerindeki etkisi Türkiye için 26 alt bölge bazında tarım, sanayi ve hizmet sektörlerini içerecek şekilde ele alınmıştır. Panel regresyon 2005-2017 dönemi için yıllık değişkenler kullanılarak tahmin edilmiştir. Panel regresyon tahmininde kullanılan değişkenler tarım, sanayi ve hizmet sektörlerinde çalışan kadın sayısı ve kamu yatırımlarından oluşmaktadır. Bulgular tarım ve sanayi sektörlerindeki kamu yatırımlarının kadın istihdamını etkilemediğini belirlemiştir. Diğer yandan hizmet sektörü kamu yatırımlarının kadın istihdamını pozitif yönde etkilediğini ortaya koymuştur. Bu sonucun önemi kadın istihdamını artırmaya yönelik politikalarda hizmet sektöründe kamu yatırımlarının katkısının açık bir şekilde ortaya konmasıdır.

The scale and effect of public investments in flood control infrastructure in Serbia from 2009 to 2021

Flood control structures play an important role in saving lives and property during floods, especially due to climate change issues. The construction, reconstruction, and rehabilitation of hydraulic structures are compliant with their maintenance and are performed periodically and preventively in order to achieve their required functional safety. However, over the years, investments in flood protection, i.e. the reduction of possible damage caused by the harmful effects of water, mostly implied investments in embankments. Investments in high dams are insufficient in terms of their importance, structure complexity, and failure risk.

Inwestycje w kapitał ludzki w ramach polityki spójności a rozwój regionalny

Investments in human capital within the cohesion policy and their impact on regional development The aim of this paper is to systematize the existing literature on the effects of cohesion policy and specifically on the effectiveness of public investments in human capital through typology of research. The conclusions are used to give recommendations both for the academic as well as the public sector. There is a need for long-term statistical and macroeconomic analyses as well as in-depth qualitative research on the quality of interventions and differences between different types of investments. While there is a lot of potential in human capital investments to stimulate regional development, they are not a sole key to success and should rather be considered as part of a horizontal and complex development strategy.

The Effectiveness of Public Investment in Basic Education in Brazil

The analysis of educational systems involves four central dimensions: economic, pedagogical, political and cultural. This paper focuses on the economic perspective, which has gained strength with the creation of the Basic Education Development Index (Ideb), and facilitates comparative analyzes of the performance of Brazilian educational systems. This research uses a linear least squares regression in which the dependent variables were the Ideb scores of Brazilian states and the independent variables were the corresponding investments in the maintenance and development of education (MDE), in the period 2005-2015. The results allow a comparative picture to be drawn of the effectiveness of the use of state resources invested by the states. It is verified that the investments in basic education in the states only partially explain the improved learning rates measured by the Ideb. Three distinct situations were observed. In 23 states there was an increase in investment in education accompanied by improvement in the Ideb. In 18 states, the increase in investments accompanied the improvement in the Ideb over a certain period, although this effect was not sustained throughout the historical series. In only 05 states, the relationship between investment and improvement in the Ideb remained positive throughout the analyzed period.

The Fiscal Multiplier of Public Investment

This paper explores whether public investment crowds out or crowds in private investment. To this aim, we build a database of about half a million firms from 49 countries. We find that the effect of public investment on corporate investment depends both on leverage and financial constraints. Public investment boosts private investment for firms with low leverage. However, for firms with high leverage, private investment does not react to an increase in public investment, in line with theory (Myers 1977). We also find that the effect of public investment on corporate investment is much weaker for firms that are financially constrained.

The Crowding-in/ out Debate in Investments in India: Fresh Evidence from NARDL Application

The purpose of the study is to re-examine the issue of the crowding-in/out effect of public investment on private investment by adopting an improved methodology of the ‘nonlinear autoregressive distributive lag’ (NARDL) model. Taking data from 1970 to 2016, the study finds that public investment crowds-in private investment both in the long-run as well as the short-run. However, the short-run elasticity is statistically more significant and larger in magnitude than the long-run elasticity. It has also been found that macroeconomic uncertainty significantly affects private investment both in the long-run and the short-run. Among other determinants of private investment, we observe foreign direct investment (FDI) inflow, credit flow to the private sector, household savings, real rate of interest and expected output affect private investment significantly. The policy implication of the study calls for the designing of public sector policies that enthuse more private investments. More credit flow to private sectors and FDI in different sectors of the economy should be prioritized. JEL Codes: E22, H54, C32

A mechanism to improve the allocation of public investment funds

Subject. This article deals with the issue of improving the public investment allocative efficiency. Objectives. The article aims to develop an approach to improve the efficiency and effectiveness of public investment in the economy. Methods. The study is based on a panel data regression with random effects. Conclusions and Relevance. All sectors of the economy have different demand for investment resources attracted, determined by operational and technological aspects. The results of the study can be used to develop an effective system of public investment.