Does sovereign debt weaken economic growth? A Panel VAR analysis

Matthijs Lof and Tuomas Malinen

MPRA Paper from University Library of Munich, Germany

Abstract: We estimate a panel vector autoregressive model to analyze the highly disputed relationship between debt and growth. Using data on 20 developed countries, we find no evidence for a robust effect on debt to growth, even for higher levels of sovereign debt. We do find a significant negative reverse effect of growth to debt, which explains the negative correlation.

Keywords: Public debt; debt share; GDP growth (search for similar items in EconPapers)
JEL-codes: C33 H63 O43 (search for similar items in EconPapers)
Date: 2013-10
New Economics Papers: this item is included in nep-fdg and nep-pbe
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Citations: View citations in EconPapers (12)

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Journal Article: Does sovereign debt weaken economic growth? A panel VAR analysis (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:52039

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