Working Paper 01-17 - Public Investment in Belgium - Current State and Economic Impact
Jan van der Linden and
Working Papers from Federal Planning Bureau, Belgium
Belgian government investment, and specifically the part spent on infrastructure, is relatively low both in historical terms and compared to neighbouring countries. A simulation with the European Commission's Quest III model suggests that increasing government investment permanently by 0.5% of GDP leads to a growth in GDP, private consumption and private investment. The impact of alternative financing mechanisms is compared. Finally, a budget neutral shift of investment in favour of infrastructure is found to yield significant benefits in terms of GDP and its main components already in the medium run.
Keywords: Public investment; Infrastructure; Public finance; General equilibrium; Simulation (search for similar items in EconPapers)
JEL-codes: E27 E62 H54 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eec and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:fpb:wpaper:1701
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