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Public debt and growth: heterogeneity and non-linearity

Eberhardt, Markus; Presbitero, Andrea F.

Authors

Andrea F. Presbitero apresbitero@imf.org



Abstract

We study the long-run relationship between public debt and growth in a large panel of countries. Our analysis builds on theoretical arguments and data considerations in modelling the debt-growth relationship as heterogeneous across countries. We investigate the debt-growth nexus adopting linear and non-linear specifications, employing novel methods and diagnostics from the time-series literature adapted for use in the panel. We find some support for a negative relationship between public debt and long-run growth across countries, but no evidence for a similar, let alone common, debt threshold within countries.

Journal Article Type Article
Publication Date Sep 30, 2015
Journal Journal of International Economics
Print ISSN 0022-1996
Electronic ISSN 0022-1996
Publisher Elsevier
Peer Reviewed Peer Reviewed
Volume 97
Issue 1
APA6 Citation Eberhardt, M., & Presbitero, A. F. (2015). Public debt and growth: heterogeneity and non-linearity. Journal of International Economics, 97(1), https://doi.org/10.1016/j.jinteco.2015.04.005
DOI https://doi.org/10.1016/j.jinteco.2015.04.005
Keywords public debt, debt threshold, economic growth
Publisher URL http://www.sciencedirect.com/science/article/pii/S0022199615000690#
Related Public URLs http://www.sciencedirect.com/science/MiamiMultiMediaURL/1-s2.0-S0022199615000690/1-s2.0-S0022199615000690-mmc1.pdf/271695/html/S0022199615000690/3a1ffa20b5ea2cc05809246c068b8052/mmc1.pdf
Copyright Statement Copyright information regarding this work can be found at the following address: http://creativecommons.org/licenses/by-nc-nd/4.0

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Copyright Statement
Copyright information regarding this work can be found at the following address: http://creativecommons.org/licenses/by-nc-nd/4.0





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