Economic and Financial Reports Volume 01/2005

Economic and Financial Reports Volume 01/2005

  •  Release date: 31 January 2005
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Evolution and Determinants of Public Investment in Europe

We examine the evolution of public investment and public capital stocks in Europe during the past three decades. Against this background, we employ an array of econometric techniques to assess the macroeconomic determinants of public investment, with a special focus on its long-term trend. We find that public investment has been determined by national income, the stance of budgetary policies, and fiscal sustainability considerations.

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