The Heterogenous Threshold Effects of Public Debt on Economic Growth: Empirical Evidence from Developing Countries

Syed Sadaqat Ali Shah1, David Dickinson2, Kunyu Tao1, Chan Wang1, Liqing Zhang1
1School of Finance, Central University of Finance and Economics, Beijing, PR China
2Birmingham Business School, University of Birmingham, Birmingham, UK

Tóm tắt

Từ khóa


Tài liệu tham khảo

Abbas SA, Blattner L, De Broeck M, El-Ganainy A, Hu M, Senhadji AS (2014) Sovereign debt composition in advanced economies: a historical perspective. IMF Working Papers, p 162

Abbas SM, Christensen JE (2010) The role of domestic debt markets in economic growth: an empirical investigation for low-income countries and emerging markets. IMF Staff Pap 57(1):209–255

Afzal M (2012) Ricardian equivalence hypothesis: evidence from Pakistan. E3 J Bus Manage Econ 3(6):258–265

Aizenman J, Marion N (2011) Using inflation to erode the US public debt. J Macroecon 33(4):524–541

Ali Abbas SM, Belhocine N, El-Ganainy A, Horton M (2011) Historical patterns and dynamics of public debt—evidence from a new database. IMF Economic Rev 59(4):717–742

Arellano M, Bover O (1995) Another look at the instrumental variable estimation of error-components models. J Econ 68(1):29–51

Ash M, Basu D, Dube A (2017) Public debt and growth: an assessment of key findings on causality and thresholds. University of Massachusetts Amherst, Department of Economics

Barro R (1995) Inflation and economic growth. No. 5326. National Bureau of Economic Research Inc

Baum A, Checherita-Westphal C, Rother P (2013) Debt and growth: new evidence for the euro area. J Int Money Finance 32:809–821

Bick A (2010) Threshold effects of inflation on economic growth in developing countries. Econ Lett 108(2):126–129

Biza RA, Kapingura FM, Tsegaye A (2015) Do budget deficits crowd out private investment? An analysis of the South African economy. Int J Econ Policy Emerg Econ 8(1):52–76

Blavy R (2006) Public debt and productivity: the difficult quest for growth in Jamaica (No. 2006/235). International Monetary Fund

Caner M, Hansen BE (2004) Instrumental variable estimation of a threshold model. Econ Theory 20(5):813–843

Cecchetti S, Mohanty M, Zampolli F (2011) The real effects of debt (No. 352). Bank for International Settlements

Checherita-Westphal C, Hallett H, Rother P (2014) Fiscal sustainability using growth-maximizing debt targets. Appl Econ 46(6):638–647

Checherita-Westphal C, Rother P (2012) The impact of high government debt on economic growth and its channels: an empirical investigation for the euro area. Eur Econ Rev 56(7):1392–1405

Chen C, Yao S, Hu P, Lin Y (2017) Optimal government investment and public debt in an economic growth model. China Econ Rev 45:257–278

Chudik A, Mohaddes K, Pesaran MH, Raissi M (2013) Debt, inflation and growth-robust estimation of long-run effects in dynamic panel data models (No. 4508). CESifo Working Paper

Chudik A, Mohaddes K, Pesaran MH, Raissi M (2017) Is there a debt-threshold effect on output growth? Rev Econ Stat 99(1):135–150

Churchman NA (2001) David Ricardo on public debt. Palgrave Macmillan, Studies in the History of Economics, UK

Clements BJ, Bhattacharya R, Nguyen TQ (2003) External debt, public investment, and growth in low-income countries. IMF Working Papers, p 249

Cochrane JH (2011) Understanding policy in the great recession: some unpleasant fiscal arithmetic. Eur Econ Rev 55(1):2–30

Cochrane JH (2022a) The fiscal roots of inflation. Rev Econ Dyn 45:22–40

Cochrane JH (2022b) A fiscal theory of monetary policy with partially-repaid long-term debt. Rev Econ Dyn 45:1–21

Cordella T, Ricci LA, Ruiz-Arranz M (2005) Debt overhang or debt irrelevance? Revisiting the debt-growth link. IMF Working Papers, p 223

Dao MQ (2012) Government expenditure and growth in developing countries. Progress Dev Stud 12(1):77–82

David D, Pedro GP, Paula HE (2005) Threshold effects in the relationship between inflation and growth: a new panel-data approach (No. 38225). University Library of Munich, Germany

Eberhardt M, Presbitero AF (2015) Public debt and growth: heterogeneity and non-linearity. J Int Econ 97(1):45–58

Égert B (2015) Public debt, economic growth and nonlinear effects: myth or reality? J Macroecon 43:226–238

Eggoh JC, Khan M (2014) On the nonlinear relationship between inflation and economic growth. Res Econ 68(2):133–143

Eichengreen B, El-Ganainy A, Esteves R, Mitchener KJ (2019) Public debt through the ages. No. w25494. National Bureau of Economic Research

Elmendorf DW, Mankiw NG (1999) Government debt. Handb Macroeconomics 1:1615–1669

Espinoza RA, Leon H, Prasad A (2010) Estimating the inflation-growth nexus—a smooth transition model. IMF Working Papers, p 076

Friedman M (1981) Deficits and inflation. Newsweek, February 23, p 1981

Fukunaga I, Komatsuzaki T, Matsuoka H, Duttagupta R (2021) Inflation and public debt reversals in advanced economies. IMF Working Papers, p 297

Ghosh AR, Kim JI, Mendoza EG, Ostry JD, Qureshi MS (2013) Fiscal fatigue, fiscal space and debt sustainability in advanced economies. Econ J 123(566):F4–F30

Gómez-Puig M, Sosvilla-Rivero S, Martínez-Zarzoso I (2022) On the heterogeneous link between public debt and economic growth. J Int Financ Mark Inst Money 77:p101528

Greiner A (2013) Debt and growth: is there a non-monotonic relation? Econ Bull 33(1):340–347

Ha J, Kose MA, Ohnsorge F (2019) Understanding inflation in emerging and developing economies. World Bank Policy Research Working Paper, p 8761

Hansen BE (2000) Testing for structural change in conditional models. J Econ 97(1):93–115

Hayakawa K (2009) On the effect of mean-nonstationarity in dynamic panel data models. J Econom 153(2):133–135

Herndon T, Ash M, Pollin R (2014) Does high public debt consistently stifle economic growth? A critique of Reinhart and Rogoff. Camb J Econ 38(2):257–279

Hilscher J, Raviv A, Reis R (2022) Inflating away the public debt? An empirical assessment. Rev Financial Stud 35(3):1553–1595

IMF (2022) Global debt monitor. In: Global Debt Database, International Monetary Fund, Washington, DC, United States

Jaimovich D, Panizza U (2010) Public debt around the world: a new data set of central government debt. Appl Econ Lett 17(1):19–24

Jeanne MOD, Guscina MA (2006) Government debt in emerging market countries: a new data set (No. 2006/098). International Monetary Fund

Klasen S, Lawson D (2007) The impact of population growth on economic growth and poverty reduction in Uganda (No. 133). University of Goettingen, Department of Economics

Kose A, Ohnsorge F, Sugawara N (2021a) A mountain of debt: navigating the legacy of the pandemic (No. 16637). CEPR Discussion Papers

Kose MA, Ohnsorge F, Reinhart C, Rogoff K (2021b) The aftermath of debt surges. In: Koç University-TUSIAD Economic Research Forum Working Papers (No. 2119). Koc University-TUSIAD Economic Research Forum

Kourtellos A, Stengos T, Tan CM (2013) The effect of public debt on growth in multiple regimes. J Macroecon 38:35–43

Kremer S, Bick A, Nautz D (2013) Inflation and growth: new evidence from a dynamic panel threshold analysis. Empir Econ 44(2):861–878

Krugman P (1988) Financing vs. forgiving a debt overhang. J Dev Econ 29(3):253–268

Kumar MS, Woo J (2010) Public debt and growth. IMF Working Papers, p 174

Law SH, Ng CH, Kutan AM, Law ZK (2021) Public debt and economic growth in developing countries: nonlinearity and threshold analysis. Econ Model 98:26–40

Lee S, Park H, Seo MH, Shin Y (2017) Testing for a debt-threshold effect on output growth. Fisc Stud 38(4):701–717

Lee S, Seo MH, Shin Y (2011) Testing for threshold effects in regression models. J Am Stat Assoc 106(493):220–231

Leeper EM (1991) Equilibria under ‘active’and ‘passive’monetary and fiscal policies. J Monet Econ 27(1):129–147

Lopes da Veiga JA, Ferreira-Lopes A, Sequeira TN (2016) Public debt, economic growth and inflation in a frican economies. South Afr J Econ 84(2):294–322

López-Villavicencio A, Mignon V (2011) On the impact of inflation on output growth: does the level of inflation matter? J Macroecon 33(3):455–464

Mishkin F, Schmidt-Hebbel K (2007) Does inflation targeting make a difference? (No. 12876). National Bureau of Economic Research Inc

Ndoricimpa A (2017) Threshold effects of inflation on economic growth: is Africa different? Int Economic J 31(4):599–620

Ndoricimpa A (2020) Threshold effects of public debt on economic growth in Africa: a new evidence. J Econ Dev 22(2):187–207

Omay T, Kan EÖ (2010) Re-examining the threshold effects in the inflation–growth nexus with cross-sectionally dependent non-linear panel: evidence from six industrialized economies. Econ Model 27(5):996–1005

Panizza U (2008) March. Domestic and external public debt in developing countries. In: United Nations Conference on Trade and Development Discussion Paper (No. 188)

Panizza U, Presbitero AF (2013) Public debt and economic growth in advanced economies: a survey. Swiss J Econ Stat 149(2):175–204

Pattillo CA, Poirson H, Ricci LA (2002) External debt and growth. IMF Working Papers, p 69

Peterson E (2017) The role of population in economic growth. SAGE Open 7(4):2158244017736094

Ramzan M, Ahmad E (2014) External debt growth nexus: role of macroeconomic polices. Econ Model 38:204–210

Reinhart CM, Rogoff KS (2010) Growth in a time of debt. Am Econ Rev 100(2):573–578

Roodman D (2009) A note on the theme of too many instruments. Oxf Bull Econ Stat 71(1):135–158

Sargent TJ, Wallace N (1981) Some unpleasant monetarist arithmetic. Federal Reserve Bank of Minneapolis Quarterly Review 5(3):1–17

Schclarek A (2005) Debt and economic growth in developing and industrial countries (No. 2005). Lund University, Department of Economics, p 34

Seo MH, Kim S, Kim YJ (2019) Estimation of dynamic panel threshold model using Stata. Stata J 19(3):685–697

Seo MH, Shin Y (2016) Dynamic panels with threshold effect and endogeneity. J Econ 195(2):169–186

Shahor T (2018) The impact of public debt on economic growth in the Israeli economy. Isr Affairs 24(2):254–264

Sims CA (1994) A simple model for study of the determination of the price level and the interaction of monetary and fiscal policy. Econ Theory 4:381–399

Thanh SD (2015) Threshold effects of inflation on growth in the ASEAN-5 countries: a panel smooth transition regression approach. J Econ Finance Administrative Sci 20(38):41–48

UNCTAD (2022) Trade and development report. In: United Nations Conference on Trade and Development

Woodford M (1995) Control of the public debt: a requirement for price stability? International Economic Association Series 117–158

World Bank (2020) The fourth wave: rapid debt build up. Global Economic Prospects. Chap. 4, January

Yang L, Su JJ (2018) Debt and growth: is there a constant tipping point? J Int Money Finance 87:133–143

Yolcu Karadam D (2018) An investigation of nonlinear effects of debt on growth. J Econ Asymmetries 18(C):1–1

Zaghdoudi T (2020) Threshold effect in the relationship between external debt and economic growth: a dynamic panel threshold specification. J Quant Econ 18(2):447–456