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Crowding Out: An Empirical Note: Reply

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  • Cebula, Richard

Abstract

This study examines the existence of crowding-out in the United States by determining to what degree the proportion of GNP devoted to private investment in new capital was affected by the proportion of GNP devoted to aggregate federal government spending. The evidence here strongly supports the crowding-out thesis but indicates that there is only incomplete crowding out. This evidence of incomplete crowding out is at odds with the extreme monetarist position; the existence of a definite but only partial crowding-out effect, however is also at odds with the extreme Keynesian position.

Suggested Citation

  • Cebula, Richard, 1979. "Crowding Out: An Empirical Note: Reply," MPRA Paper 56629, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:56629
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    File URL: https://mpra.ub.uni-muenchen.de/56629/1/MPRA_paper_56629.pdf
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    References listed on IDEAS

    as
    1. Keith M. Carlson & Roger W. Spencer, 1975. "Crowding out and its critics," Review, Federal Reserve Bank of St. Louis, vol. 57(Dec), pages 2-17.
    2. Cebula, Richard, 1977. "Crowding Out: An Empirical Note," MPRA Paper 54515, University Library of Munich, Germany.
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    More about this item

    Keywords

    budget deficit; crowding out; investment;
    All these keywords.

    JEL classification:

    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • H69 - Public Economics - - National Budget, Deficit, and Debt - - - Other

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