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Figure 3.3 Public Investment Levels and the Global Crisis, 2008–09 30
change in government investment (% points, 2008–09)
25 20 15 10 5 0 –5 –10 0
5
10
15
20
25
30
government investment (% GDP, 2008) Source: IMF World Economic Outlook database. Note: Squares represent the change in government investment levels as percentage points of gross domestic product (GDP).
Kuwait and São Tomé and Príncipe, were arguably associated with commodity windfalls, while others, such as the United States, reflect a conscious stimulus decision. Overall, the change in investment volumes was very weakly associated with preexisting stocks. However, this result is driven significantly by a number of outliers. Many of those countries (for example, Iraq, Angola, Libya, and Algeria) are also heavily dependent on oil revenues, and so these results reflect collapsing oil prices and different fiscal adjustments in 2009. Although the available evidence provides some insights into the observed patterns of public investments and the global crisis, further case studies and systematic econometric analysis could help further elucidate observed patterns.10 Since the crisis, there has been a renewed policy interest in creating and maintaining economic and socially productive capital assets across the globe, focusing on both leveraging private sector resources and improving public sector resource allocation and regulatory decision making to fill the remaining gaps. Although previous periods of economic crisis and fiscal adjustment have been associated with public investment