Public & Private Investments Crowding in and Out, and their Impacts on GDP During the Period 1982-2018 With applications on Industry, Agriculture and Construction Sectors in Egypt
Abstract
The study aims at determining the relationship between public and private investment in Egypt's most important productive sectors namely agriculture, industry, and construction, and determine if there is a crowding out or crowding in effects, It is hoped that this examination will improve the quality of currently used tools in fiscal and monetary policies to achieve total investment in these sectors and hence their contribution to GDP. The research considered the period form 1982-to-2018 -This period was chosen due to the multiple financial and monetary policies used in the Egyptian economy-.The study used the descriptive analytical methodology and the standard methodology, Flexible accelerator model, Granger causality test, and KPSS test were applied, in addition to two models of multiple linear regression? The most important findings of the study are the existence of a crowding in relationship between public and private investment in the sectors of industry, agriculture, construction in Egypt in the long term, and positive effect for public and private investment in those sectors on the development of the GDP in Egypt during the study period. In addition to the impact of private investment in the construction sector on GDP was greater than that of private investment in the other sectors studied, and the impact of public investment in agriculture on GDP outweighed that of public investment in the other sectors studied. The study recommended the need to inject more private investment in industry and agriculture, and creating the suitable environment for investment and more incentives for the private sector to invest in those sectors, whether through the tools of fiscal policy or monetary policy. Keywords: Public investment- private investment – Crowding Out Effect– Crowding In Effect - industry - agriculture - construction - productive sectors - GDP
