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Volume 8, No. 2,
August 2009
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Public
Spending and the Macroeconomy: Evidence from
Developing and Developed Countries
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Magda
Kandil*
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International Monetary Fund, Western Hemisphere
Department, U.S.A.
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Abstract
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Using annual data, this paper studies
the time series evidence regarding the effectiveness of
government spending. Crowding out appears more prevalent
in the face of variation in government spending in
advanced countries. Private consumption and inflation
vary more closely with government spending in developing
countries.
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Key words
:
fiscal stimulus; crowding out; supply
constraints;
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developing and advanced countries
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JEL classification
:
E61;
E62; E63; E32; E21
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