Estimating Fiscal Multiplier for Qatar: Qatar
Selected Issues Papers, March 7, 2025
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Bibliographic details
- Authors: Ken Miyajima
- Published: March 7, 2025
- Series: Selected Issues Papers
- DOI: https://doi.org/10.5089/9798229004503.018
Key findings
- Econometric results suggest that Qatar’s strong capital spending multiplier became less impactful as the stock of capital rose to a high level, likely as the marginal impact declined.
- The evidence supports Qatar’s strategy to shift the State’s role to an enabler of private sector-led growth.
- Policy emphasis should focus on expenditure to support building human capital and implementation of broader reform guided by the Third National Development Strategy.
Implications for fiscal policy and public investment
- Diminishing marginal returns: As the stock of capital reached a high level, the marginal impact of additional capital spending declined, reducing the effectiveness of further capital expenditures.
- Reorienting expenditure composition: Given lower marginal returns to capital spending, prioritizing spending that builds human capital and supports structural reforms is indicated.
- State role transition: Moving from direct state-led capital accumulation toward enabling private sector-led growth aligns with the empirical results.
Policy recommendations (derived from the analysis)
- Shift some emphasis from pure capital expenditure toward programs that build human capital.
- Accelerate implementation of broader reforms consistent with the Third National Development Strategy to enhance private sector participation and multiplier effects.
- Monitor the stock of public capital and its marginal productivity when designing future public investment plans.
Ken Miyajima, March 7, 2025. Estimating Fiscal Multiplier for Qatar: Qatar.
Content in this bundle
- Estimating Fiscal Multiplier for Qatar; IMF Selected Issues Paper No. 2025/016; January 8, 2025