Institutions Determine Debt–Growth Relationship: Evidence from Fourth Wave of Debt in EMDEs

IF 0.9 Q3 ECONOMICS

INTERNATIONAL ECONOMIC JOURNAL Pub Date : 2023-03-08 DOI:10.1080/10168737.2023.2184845

S. Bagchi, Sayantan Bandhu Majumder, Somdutta Banerjee

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引用次数: 0

Abstract

ABSTRACT The last decade witnessed global debt levels to reach record high. In Emerging Market and Developing Economies (EMDEs) like never before, the (public and private) debt–GDP ratio has been dismally high. An upward spree of the debt–GDP ratio coupled with a looming economic crisis led to concerns about institutional qualities (IQ). We explore how different dimensions of IQ (namely, political, legal and governance) impact the debt–growth relationship in the EMDEs amidst the current fourth wave of debt (2010–2019). We examine whether the relation is monotonic or it varies around a particular threshold value of IQ. By applying a dynamic panel threshold regression model, we obtain two regime-dependent marginal effects of regressors (upper and lower regimes) that are distinguished by a threshold value of IQ. Our results reveal that for each of our considered IQ, there exists a statistically significant threshold value. For public debt, across all dimensions of IQ debt hurts growth in the lower regime, while in the upper regime the association is favourable. While private debt is growth enhancing in the lower regime of all IQs (excepting corruption), while it is inimical in the upper regime.

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制度决定债务-增长关系：来自EMDE第四波债务的证据

摘要过去十年，全球债务水平创历史新高。在新兴市场和发展中经济体（EMDE），（公共和私人）债务与GDP的比率前所未有地高。债务与GDP比率的大幅上升，加上迫在眉睫的经济危机，引发了人们对制度质量的担忧。我们探讨了IQ的不同维度（即政治、法律和治理）如何在当前的第四波债务浪潮（2010-2019）中影响EMDE的债务增长关系。我们检验了这种关系是单调的，还是在某个特定的智商阈值周围变化。通过应用动态面板阈值回归模型，我们获得了由智商阈值区分的回归因子的两个状态依赖的边际效应（上状态和下状态）。我们的结果表明，对于我们考虑的每个智商，存在统计上显著的阈值。对于公共债务，在智商债务的各个方面，下层政权的债务都会损害增长，而上层政权的债务则是有利的。虽然私人债务在所有IQ的下层政权中都在增长（腐败除外），但在上层政权中却是不利的。

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

INTERNATIONAL ECONOMIC JOURNAL Economics, Econometrics and Finance-Economics, Econometrics and Finance (all)

CiteScore

2.10

自引率

0.00%

发文量

期刊介绍： International Economic Journal is a peer-reviewed, scholarly journal devoted to publishing high-quality papers and sharing original economics research worldwide. We invite theoretical and empirical papers in the broadly-defined development and international economics areas. Papers in other sub-disciplines of economics (e.g., labor, public, money, macro, industrial organizations, health, environment and history) are also welcome if they contain international or cross-national dimensions in their scope and/or implications.