Crowding Out: An Empirical Note: Reply

Cebula, Richard (1979): Crowding Out: An Empirical Note: Reply. Published in: The Quarterly Revew of Economics and Business , Vol. 20, No. 2 (31 August 1980): pp. 110-111.

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.

• Item Type: MPRA Paper
• Language: English
• Keywords: budget deficit; crowding out; investment
• Subjects: H - Public Economics > H3 - Fiscal Policies and Behavior of Economic Agents > H32 - Firm; H - Public Economics > H6 - National Budget, Deficit, and Debt > H62 - Deficit ; Surplus; H - Public Economics > H6 - National Budget, Deficit, and Debt > H69 - Other

References

1. K.M. Carlson and R.W. Spencer, “Crowding Out and Its Critics,” Federal Reserve Bank of St. Louis Review, Vol. 57 (December 1975), pp. 2-17. 2. R.J. Cebula, “Crowding Out: An Empirical Note,” Quarterly Review of Economics and Business, Vol. 18 (Autumn 1978), pp. 119-23.