This paper aims to conduct an empirical enquiry into determining the
impact of public expenditure on private investment in agriculture to
discover as to whether the former casts a crowding-in or crowding-out
effect on the latter, simultaneously controlling for the oil-related factors
which are oil price and oil production in the case of Azerbaijan. The
Autoregressive Distributed Lag Bounds Testing (ARDLBT) approach to
cointegration has been applied by means of employing the quarterly
data for the period 2001Q4–2017Q3. The results manifest that public
expenditure crowds in private investment to agriculture in the long-run,
demonstrating both strong statistical and economic significance. The
empirical findings obtained herein are beneficial for the policy-making
purposes, and the meagreness of the related literature concerning
Azerbaijan makes us deduce that further empirical research should be
implemented.
Citation:
Ismayilov, A., & Zeynalli, M. (2018). The impact of public expenditure on private investment in agriculture: Crowding in or crowding out? Evidence from Azerbaijan. ASERC Journal of Socio-Economic Studies, 1(1), 45-59. DOI:10.30546/2663-7251.1.1.45