The Effect of Sovereign Debt on Economic Growth: The Case of Oil-Rich Countries

Hussein Salameh, Ahmed Alodadi and Khaled Alzubi
Additional contact information
Hussein Salameh: Researcher, Amman, Jordan,
Ahmed Alodadi: College of Business, King Khalid University, Abha, Saudi Arabia,
Khaled Alzubi: College of Economics and Administrative Sciences, Hashemite University, Jordan.

International Journal of Economics and Financial Issues, 2020, vol. 10, issue 2, 262-267

Abstract: Key studies have identified the need to study the role of sovereign debt on economic growth, particularly in relation to countries with heavily oil-based status economies. This paper applies a panel vector autoregressive approach to examine the impact of sovereign debt on economic prosperity in several oil-rich countries between 2002 and 2017. The results show that in oil countries, like other developing countries, government debt has not had a positive impact on enhancing economic growth, resulting in a reluctance of such countries to invest debts in production, and a desire for the type of diversification of sources of income observable in most advanced countries.

Keywords: Co-integration; Sovereign Debt; Oil-rich Countries (search for similar items in EconPapers)
JEL-codes: A10 B22 B23 E23 E52 E62 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eco:journ1:2020-02-30

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