Determinants of External Debt in Jordan: An Empirical Study (1990–2014)

Abstract

<p>This study aimed at investigating the major determinants influencing the external debt in Jordan during the period (1990-2014).</p><p>To achieve this goal, annual data has been used during the period study, through applying ARDL model which consist of the dependent (external debt) and independent variables (trade openness, term of trade, exchange rate, and gross domestic product per capita).</p><p>The study reviled that there is a positive statistically significant effect trade variable on the external debt in the long run, and a negative statistically significant effect for the gross domestic product per capita variable (GDPpc) on the external debt.</p><p>The study recommended that it is very important to depend on the available recourses in trading rather that depend on external debt.</p>

An empirical investigation into the determinants of external debt in Asian developing and transitioning economies

“…On one hand, trade openness creates or generates employment opportunities and foreign exchange reserves (Duodu and Baidoo 2020b). On the other hand, it leads to higher external debt when imports exceed exports, as reported by Al-Fawwaz (2016).…”

“…Common determinants of external debt reported in existing literature are economic growth, imports, population, foreign exchange reserves, total debt service, poverty, income instability, depreciation of the currency, budget deficit, exchange rate, trade openness, terms of trade, inflation, interest rate, national savings, and financial development (Abdullahi, Bakar, and Hassan 2015;Bittencourt 2015;Lau, Lee, and Apir 2015;Vighneswara 2015;Lau and Lee 2016;Al-Fawwaz 2016;Belguith and Omrane 2017;Özata 2017;Udoh and Rafik 2017;Chiminya, Dunne, and Nikolaidou 2018;Chirwa and Odhiambo 2018;Adamu 2019;Brafu-Insaidoo et al 2019;Fatukasi et al 2020). For instance, Vighneswara (2015) and Beyene and Kotosz (2020a) asserted that government expenditure is one of the key factors that increase external debt due to budget deficits, which compel governments to borrow.…”

“…In recent years, researchers and policymakers have paid greater attention to external debt, and hence investigated the determinants of external debts in developing countries, which are mostly non-Asian. Most studies on external debt are country-specific (see, for example, Awan, Anjum, and Rahim 2015;Al-Fawwaz 2016;Belguith and Omrane 2017;Özata 2017;Brafu-Insaidoo et al 2019;Wahyuni, Muhammad, and Nazamuddin 2019), and for that matter, the findings could not be generalized for the rest of the world; this is as a result of differences in geographical and economic conditions among countries. Again, some past studies have focused on the impact of external debt on economic growth, but it is equally prudent and imperative to ascertain the factors which affect or cause external debt.…”

Causes External Debt of the Private Sector in Turkey: A Macroeconomic Approach

“…According to Table 2, In general there are the positive relation between external debt stock and budget deficit, investment expenditures, external openness, export and import volume, LIBOR and inflation rate (Dücan, 2017;Akduğan, 2017;Al-Fawwaz, 2016;Hallak, 2009;Edo, 2002;Hajivassiliou, 1987); there is negative relation among external debt, GDP, money supply, domestic savings and exchange rate variables (Akduğan, 2017). Some studies also find a positive relation between external debt and GDP (Erdem, Akdemir and İlgün, 2014;Cordelle, Ricci and Arranz, 2005;Tinureh, 2004;Lane, 2004).…”

Özel Sektör Diş Borçlanmasinda İkti̇sadi̇ Poli̇ti̇kalarin Etki̇leri̇: Türki̇ye Örneği̇

“…Tablo 2'de dış borçlanma alanında erişilebilen çalışmalardan örneklere yer verilmiştir. Tablo 2'de yer alan çalışmaları şu şekilde özetlenebilir: Genellikle toplam dış borçlanma ile bütçe açığı, yatırım harcamaları, dışa açıklık, ihracat ve ithalat hacmi, LİBOR, enflasyon oranı arasında pozitif yönlü ilişki tespit edilmiştir (Dücan, 2017;Akduğan, 2017;Al-Fawwaz, 2016;Hallak, 2009;Edo, 2002;Hajivassiliou, 1987). GSYH, para arzı, iç tasarruflar, döviz kuru değişkenleri ile toplam dış borçlanma arasında ise negatif yönlü ilişki belirlenmiştir (Akduğan, 2017…”