Role of government spending on economic growth: an endogenous potential model for Bolivia

Roger Banegas Rivero ()

Revista Nicolaita de Estudios Económicos, 2016, vol. XI, issue 1, 27-48

Abstract: The purpose of this paper is to contribute with an endogenous potential growth model (EPGM) for Bolivia from 1993 to 2012. The empirical evidence suggests that government consumption is the main exogenous determinant on potential growth (EPGM) with differentiated time effects: it accelerates contemporaneously economic growth but it affects negative and dynamically on long-term growth rate. Public and private investments have significant and dynamical degree of substitution (crowding out effect). As complementary analysis, effects of public spending on real effective growth are evaluated.

Keywords: Role of public spending; crowding-out effect; potential output growth; real effective growth (search for similar items in EconPapers)
JEL-codes: H50 H54 L38 O11 O23 (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:ris:rnicee:0100

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