Can government demand stimulate private investment? : evidence from U.S. federal procurement /

Can government demand stimulate private investment? : evidence from U.S. federal procurement /

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Bibliographic Details
Author / Creator:Hebous, Shafik, (IMF staff)
Imprint:[Washington, D.C.] : International Monetary Fund, 2016.
©2016
Description:1 online resource (33 pages) : illustrations.
Language:English
Series:IMF Working Paper ; WP/16/60
IMF working paper ; WP/16/60.
Subject:
Investments -- Econometric models.
Government purchasing -- Econometric models.
Government purchasing -- Econometric models.
Investments -- Econometric models.
Format: E-Resource Book
URL for this record:http://pi.lib.uchicago.edu/1001/cat/bib/12504823
Hidden Bibliographic Details
Other authors / contributors:Zimmerman, Tom G., author.
International Monetary Fund. Fiscal Affairs Department, issuing body.
ISBN:9781513579849
1513579843
151357938X
9781513579382
Notes:"March 2016."
"Fiscal Affairs Department."
Includes bibliographical references (pages 29-31).
Online resource; title from pdf title page (IMF.org Web site, viewed March 16, 2016).
Summary:We study the effects of federal purchases on firms investment using a novel panel dataset that combines federal procurement contracts in the United States with key financial firm-level information. We find that 1 dollar of federal spending increases firms capital investment by 7 to 11 cents. The average effect masks heterogeneity: Effects are stronger for firms that face financing constraints and they are close to 0 for unconstrained firms. In line with the financial accelerator model, our findings indicate that the effect of government purchases works through easing firms access to external borrowing. Furthermore, industry-level analysis suggests that the increase in investment at the firm level translates into an industry-wide effect without crowding-out capital investment of other firms in the same industry.--Abstract.
Other form:Print version: Hebous, Shafik. Can Government Demand Stimulate Private Investment? Evidence from U.S. Federal Procurement : Washington, D.C. : International Monetary Fund, ©2016 9781513578729
Table of Contents:
  • Cover
  • Contents
  • Abstract
  • I. Introduction
  • II. Hypothesis Development
  • III. Data
  • A. Federal Procurement Data
  • B. Firm-Level Data
  • IV. Empirical Analysis
  • A. Specification
  • B. Baseline Results
  • V. Anticipation and Robustness
  • A. Are Competitive Contracts Anticipated?
  • B. Robustness to Model Specification
  • C. Robustness to Contract Selection
  • D. Conclusion
  • References.

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