Empirical evidence of impacts of public investment on economic growth in Vietnam

Abstract

Debate continues to rage over the short- and long-term effects of public investment on economic growth as well as the effectiveness of public investment when compared to other types of societal investment both globally and in Vietnam. In order to supplement empirical evidence on this issue, the study uses the ARDL model to assess the impact of public investment on Vietnam’s economic growth in the period 1995-2019. Research results show that growth in public investment, private investment and foreign investment all have a positive impact on economic growth in the long run. However, the short-term effect of public investment has not been confirmed. At the same time, the impact of public investment on economic growth is weaker than that of private investment. On the basis of empirical analysis, the study proposes some policy implications in enhancing the efficiency of public investment in Vietnam.