Menu
Home
People
Places
Arts
History
Plants & Animals
Science
Life & Culture
Technology
Reference.org
Crowding-in effect
open-in-new
<p>Crowding-in occurs when an increase in government spending leads to more private investment. It occurs because public investment makes the <a href="/facts/Private_sector/fQudW9hp">private sector</a> more productive, as well as because government spending may have a stimulative effect on the economy. It is contrasted with <a href="/facts/Crowding_out_(economics)/QMxQY0qJ">crowding out</a>, which occurs when government spending leads to less private investment. </p>