Public debt and economic growth: what do neoclassical growth models teach us?

Dombi, Ákos; Dedák, István

doi:10.1080/00036846.2018.1508869

Cited by 28 publications

(22 citation statements)

References 37 publications

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“…According to a separate study, a negative relationship is developed between "public dept" and "growth" across countries; it seems though that the debt threshold constitutes the main factor determining how much negative the above relationship may be (Eberhardt and Presbitero, 2015). Further to another study, the negative effects of public debt's increase on growth crucially depend on the saving rate as well as on the population growth rate, while that study also underlines that the deceleration rate of growth due to public dept is lower in developed economies (Dombi and Dedák, 2019).…”

Section: Public Debt and Growthmentioning

confidence: 77%

Fiscal Policy, Growth and Competitiveness in Emu: Evidence From Portugal and Greece

Psychalis¹,

Gournas²,

Grigorakou³

et al. 2020

IJEFI

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This paper aims at examining whether reforms in EU economic and fiscal governance between the period starting from 2010 and ending on 2018 have increased the Gross Domestic Product growth rate in Greece and Portugal. Reforms occurred, such as "Six Pack," "Two Pack," the "Fiscal Compact," and the "Euro Plus Pact," have focused on fiscal consolidation and competitiveness improvement; in other words, during the aforementioned time period, EMU concentrated on the improvement of internal as well as external imbalances. Moreover, the present paper assesses the international competitiveness through the prism of two main indicators: Unit Labour Cost and Current Account Balance. It seems that the literature is not crystal clear on the relationship between debt and the fiscal policy on the one side, competitiveness and growth from the other side. The findings of the paper may be of great assistance to policy makers on growth, competitiveness and fiscal policy, as they highlight the relationship between economic stability, entrepreneurship and growth. The herein below presented results demonstrate that there is, indeed, a strong relationship between fiscal consolidation and growth, while the relationship between public debt, Unit Labour Cost, Current Account Balance and growth remains blurred.

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Section: Public Debt and Growthmentioning

confidence: 77%

Fiscal Policy, Growth and Competitiveness in Emu: Evidence From Portugal and Greece

Psychalis¹,

Gournas²,

Grigorakou³

et al. 2020

IJEFI

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show abstract

“…The group of theoretical papers claims would argue that grave concern is more when the foreign currency is preferred to a domestic currency which often leads to financial crises. Besides, the vast majority of studies have suggested that the source of government financing does not matter, but the spending structure should be significant attention [4,18], but this study undermines the possibility that unsustainable of debt can have a varied consequence on investment, consumption, and output level. Thus, it would appear this suggestion took for granted the option that public debt can have a different effect on the economy both internally and externally.…”

Section: Introductionmentioning

confidence: 89%

“…Due to the large fiscal imbalance faced by most countries, the government resorts to an external source of revenue in the form of borrowing to augment its internal revenue. While this practice in itself is not bad, an excess accumulation of debt creates serious fiscal problem for both current and future generations if not properly managed [4,18]. This is because mismanagement of external borrowing has little or no significant impact on the gross domestic product (GDP) thereby increasing the debt-to-GDP ratio and draining out government revenue via debt servicing and interest payment.…”

Section: Introductionmentioning

confidence: 99%

Debt sustainability and the fiscal reaction function: evidence from MIST countries

Ogbeifun

Shobande

2020

Futur Bus J

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The use of public debt is not new in financing developmental objectives. A significant challenge arose when it became obvious that the indebted countries could not fulfill its existing financial obligation to the rest of the world where debt is sourced. For a panel of 4 heterogeneous countries from 1990 to 2017, we study governments’ reactions to debt accumulation and the corrective measures taken when its borrowings result in a rise in debt–GDP ratio. The study evidence is based on the fixed effect and the feasible generalized least squares estimators. We find evidence that primary balance improves by about 0.005–0.013 for every 1 percentage point increase in central government debt after controlling for other relevant factors. The results further suggest that the accrued interest payments on debt reflect the effective debt management policies across the countries, whereas the activities on the current account balance impose a possible threat to the primary balance. The study calls for policies that increase fiscal bases through the reduction in fiscal expenditure and the reinforcement of tax base revenue across the MIST countries.

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“…σ-convergence is mainly used to describe the stock level of virtual cultivated land in each region [ 40 ]. When there are objective differences in natural resource conditions in the different areas, σ-convergence can test the temporal changes of the flow intensity of virtual cultivated land across the country and various provinces.…”

Section: Methodsmentioning

confidence: 99%

Dynamic Evolution and Spatial Convergence of the Virtual Cultivated Land Flow Intensity in China

Wang

Jabbar

et al. 2021

IJERPH

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Exploring the flow intensity of virtual cultivated land is the key to improving the ecological compensation and food security policy. This study aimed to analyze the dynamic evolution, spatial convergence, and its affecting factors of the virtual cultivated land flow intensity. The spatial convergence model was used in this study. The results showed that, during 2000–2018, the growth rate of the surplus state of virtual cultivated land at the national level is less than that of the deficit state of virtual cultivated land in China. Moreover, the number of deficit provinces of virtual cultivated land flow intensity is increasing. The absolute β-convergence characteristics of the virtual cultivated land flow intensity are significant at the national, northeast, central, and western regions. Additionally, the conditional β-convergence exists at the national and four regional levels. Meanwhile, cultivated land resource endowment, population scale, regional economic development level, and agricultural mechanization level play an important role in the convergence process of inter-regional virtual cultivated land flow intensity. However, the influence degree of different control variables on different regional virtual cultivated land flow intensity is not consistent. Therefore, policymakers should pay attention to cultivated land resources’ spatial transfer mechanism when making regional cultivated land ecological compensation policies to coordinate the interesting relationship between the deficit area and surplus area of virtual cultivated land. Therefore, it is necessary to take the virtual cultivated land flow intensity as the reference index and use the combination of market guidance and government control to stimulus the stakeholders to protect cultivated land by taking different measures.

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Public debt and economic growth: what do neoclassical growth models teach us?

Cited by 28 publications

References 37 publications

Fiscal Policy, Growth and Competitiveness in Emu: Evidence From Portugal and Greece

Fiscal Policy, Growth and Competitiveness in Emu: Evidence From Portugal and Greece

Debt sustainability and the fiscal reaction function: evidence from MIST countries

Dynamic Evolution and Spatial Convergence of the Virtual Cultivated Land Flow Intensity in China

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