External debt and economic growth: moderating role of governance in South Asia Region

IF 2.5 Q2 ECONOMICS

Eurasian Economic Review Pub Date : 2024-04-09 DOI:10.1007/s40822-024-00264-0

Umar Farooq, Adel Ahmed, Mosab I. Tabash, Mujeeb Saif Mohsen Al-Absy, Yasmeen Elsantil

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引用次数: 0

Abstract

The current analysis explores the effect of external debt on economic growth and how better governance interacts with this relationship. For empirical assessment, we sample 20 years of data (2000–2019) of South Asian economies and consider the FMOLS and DOLS models to model the regression among the variables. The statistical analysis reveals a significant negative effect of both long- and short-term external debts, while governance has a significant positive effect on economic growth. In addition, the positive moderating role of governance was also observed in the nexus of external debt and economic growth. Enhancing governance can make external borrowing beneficial for economic progress. The empirical analysis posits multiple policies regarding the reduction of external borrowings, enhancement of the quality of governance, and effective utilization of external debt for development projects through better governance systems. By exploring the empirical relationship between external debt, governance, and economic growth, this study provides original evidence on how to enhance the utilization of external debt to ensure economic growth.

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外债与经济增长：南亚地区治理的调节作用

当前的分析探讨了外债对经济增长的影响，以及更好的治理如何与这种关系相互作用。为了进行实证评估，我们以南亚经济体 20 年（2000-2019 年）的数据为样本，并考虑使用 FMOLS 和 DOLS 模型来建立变量间的回归模型。统计分析显示，长期和短期外债对经济增长都有显著的负向影响，而治理对经济增长则有显著的正向影响。此外，在外债与经济增长的关系中，还观察到了治理的积极调节作用。加强治理可以使外债有利于经济进步。实证分析提出了减少外债、提高治理质量以及通过改善治理体系有效利用外债促进发展项目的多重政策。通过探索外债、治理和经济增长之间的经验关系，本研究为如何加强外债利用以确保经济增长提供了原创性证据。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Eurasian Economic Review ECONOMICS-

CiteScore

6.00

自引率

2.90%

发文量

期刊介绍： The mission of Eurasian Economic Review is to publish peer-reviewed empirical research papers that test, extend, or build theory and contribute to practice. All empirical methods - including, but not limited to, qualitative, quantitative, field, laboratory, and any combination of methods - are welcome. Empirical, theoretical and methodological articles from all fields of finance and applied macroeconomics are featured in the journal. Theoretical and/or review articles that integrate existing bodies of research and that provide new insights into the field are highly encouraged. The journal has a broad scope, addressing such issues as: financial systems and regulation, corporate and start-up finance, macro and sustainable finance, finance and innovation, consumer finance, public policies on financial markets within local, regional, national and international contexts, money and banking, and the interface of labor and financial economics. The macroeconomics coverage includes topics from monetary economics, labor economics, international economics and development economics. Eurasian Economic Review is published quarterly. To be published in Eurasian Economic Review, a manuscript must make strong empirical and/or theoretical contributions and highlight the significance of those contributions to our field. Consequently, preference is given to submissions that test, extend, or build strong theoretical frameworks while empirically examining issues with high importance for theory and practice. Eurasian Economic Review is not tied to any national context. Although it focuses on Europe and Asia, all papers from related fields on any region or country are highly encouraged. Single country studies, cross-country or regional studies can be submitted.