Public Expenditure and Private Sector Investment in WAEMU Countries
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Date
2016-10-03
Authors
Nézan, Okey Mawussé Komlagan
Journal Title
Journal ISSN
Volume Title
Publisher
African Economic Research consortium
Abstract
This paper seeks to analyse the nature of the relationship between public expenditure
and private investment in eight WAEMU countries for the period 1980–2009. Our
analysis, using econometric estimations, shows that total public expenditure and its
capital component positively and significantly affect private investment. The results
also highlight a non-linear quadratic relationship between public spending and private
investment. Public spending and its capital component (share of GDP) should be at
least 20% and 8.79%, respectively, before having a significant positive effect on private
investment. Governments and policy makers should pursue the vast infrastructure policies
undertaken these last years in the WAEMU zone and mobilize more resources to finance
capital expenditures.
Description
Keywords
Public expenditure , , private investment , , WAEMU