Effect of Fiscal Policy on Private Investment in Iran

Abstract

The link between public and private investment and their effects on each other investigated by many economists in the past. In this study, we investigate the effects of some economic variables on private investment. These variables are different types of government expenses (current and development fund). The results suggest that budget deficit leads to expansion of private investment and there is a time-lag for this effect. We use ARDL Technique and the period of study is 1963-2001

Keywords

• public and private investment
• government expenditures
• government deficit