Can Budget Deficits Financing, Crowed Out Private Sector? Comparative Study of the Cases of Iran and Algeria

Zahra Karimi Takanlou ()
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Zahra Karimi Takanlou: Faculty of Economics, Management and business, Tabriz University, Tabriz, Iran.

Iranian Economic Review (IER), 2014, vol. 18, issue 3, 1-25

Abstract: This paper develops an analysis of budget deficit financing in terms of a crowding out or crowding in effect on the activity of the private sector for the economies of Iran and Algeria as two MENA countries (because of its economic structures (dependence on oil revenue)) during the period 1970-2012 by using Cointegration and Vector Error Correction approaches. The analysis confirms the existence of a crowding out effect in Algeria and a crowding in effect in Iran.

Keywords: Budget Deficit; Private Sector; Crowding out or Crowding in Effects; Cointegration; VECM (Vector Error Correction Model). (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eut:journl:v:18:y:2014:i:3:p:1

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