Public Debt and Economic Growth in Emerging Market Economies

This paper empirically studies the relationship between public debt and economic growth for selected emerging market economies by performing panel data estimations. The results reveal a statistically significant positive correlation between public debt and the subsequent growth rate of per capita gr...

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Bibliographic Details
Published inThe South African Journal of economics Vol. 83; no. 3; pp. 357 - 370
Main Authors Fincke, Bettina, Greiner, Alfred
Format Journal Article
LanguageEnglish
Published Johannesburg Blackwell Publishing Ltd 01.09.2015
Wiley Subscription Services, Inc
Subjects
Correlation analysis
Deficit financing
E62
Economic growth
Emerging markets
fixed effects estimation
GDP
Gross Domestic Product
Growth theory
H63
Investment
Market economies
Market economy
Per capita
Public debt
random effects estimation
Studies
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Summary:This paper empirically studies the relationship between public debt and economic growth for selected emerging market economies by performing panel data estimations. The results reveal a statistically significant positive correlation between public debt and the subsequent growth rate of per capita gross domestic product (GDP). Population and investment are also positively correlated with per capita growth, whereas the initial level of real GDP per capita exerts a negative influence on growth, implying conditional convergence. Other variables such as the inflation rate, the trade balance or the exchange rate do not yield a statistically significant effect with respect to economic growth.
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ark:/67375/WNG-46M7GBK5-D
ObjectType-Article-1
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content type line 23
ISSN:0038-2280
1813-6982
DOI:10.1111/saje.12079