Abstract
This chapter undertakes 25 tests of different models to determine if the government deficit has a significant, measurable crowd out effect on investment as well as a stimulus effect. The models included 16 OLS and 9 2SLS models. Results overwhelmingly indicated crowd out adversely affected investment spending. The two separate variables (Revenue, Spending) definition of the deficit was used, with coefficients calculated for each, to see if the two types had different effects.
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Heim, J.J. (2017). Test Results: Investment Spending and Borrowing Models (Two-Variable Deficit). In: Crowding Out Fiscal Stimulus. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-45967-7_8
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DOI: https://doi.org/10.1007/978-3-319-45967-7_8
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Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-45966-0
Online ISBN: 978-3-319-45967-7
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