This paper seeks to identify the conditions under which raising public investment can sustainably lift growth without deteriorating public finances. To do so, it relies on a range of simulations using three different macro-structural models. According to the simulations, OECD governments could...

An estimated baseline convergence model capturing the long-term effect of human capital and physical investment on potential output for a panel of OECD countries is augmented with public investment and its components. The estimations suggest that public investment has a positive effect on...