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

IF 0.6 Q4 ECONOMICS South Asian Journal of Macroeconomics and Public Finance Pub Date : 2020-08-23 DOI:10.1177/2277978720942676

Nusrat Akber, Megha Gupta, K. R. Paltasingh

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引用次数: 5

Abstract

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

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印度投资的挤进/挤出辩论:来自NARDL应用的新证据

本研究的目的是通过采用一种改进的“非线性自回归分配滞后”(NARDL)模型，重新审视公共投资对私人投资的挤出效应问题。根据1970年至2016年的数据，该研究发现，无论是长期还是短期，公共投资都会挤占私人投资。然而，短期弹性在统计上比长期弹性更显著，规模更大。研究还发现，宏观经济的不确定性在长期和短期内对私人投资都有显著影响。在私人投资的其他决定因素中，我们观察到外国直接投资(FDI)流入、私人部门信贷流动、家庭储蓄、实际利率和预期产出对私人投资有显著影响。该研究的政策含义要求设计公共部门政策，以激发更多的私人投资。应优先考虑向私营部门和不同经济部门的外国直接投资提供更多信贷。JEL代码:E22, H54, C32

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来源期刊

South Asian Journal of Macroeconomics and Public Finance ECONOMICS-

CiteScore

2.10

自引率

11.10%

发文量

期刊介绍： The purpose of the Journal is to publish (in English language) peer-reviewed articles, reviews and scholarly comments on issues relating to contemporary global macroeconomics and public finance by which is understood: The Journal is for all professionals concerned with contemporary Macroeconomics and Public Finance and is a forum for all views on related subjects. The Editorial Board welcomes articles of current interest on research and application on the areas mentioned above. The Journal will be international in the sense that it seeks research papers from authors with an international reputation and articles that are of interest to an international audience. In pursuit of the above, the journal shall: a. draw on and include high quality work from the international community of scholars including those in the major countries of Asia, Europe, Asia Pacific, the United States, other parts of the Americas and elsewhere with due representation for considerations of the readership. The Journal shall include work representing the major areas of interest in contemporary research on Macroeconomics and Public Finance and on a wide range of issues covering macro- economics, tax and fiscal issues, banking and finance, international trade, labour economics, computational and mathematical methods, etc. The Journal would particularly engage papers on pure and applied economic theory and econometric methods. b. avoid bias in favour of the interests of particular schools or directions of research or particular political or narrow disciplinary objectives to the exclusion of others. c. ensure that articles are written in a terminology and style which makes them intelligible, not merely within the context of a particular discipline or abstract mode, but across the domain of relevant disciplines.