Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/174419
Authors: 
Ash, Michael
Basu, Deepankar
Dube, Arindrajit
Year of Publication: 
2017
Series/Report no.: 
Working Paper 2017-10
Abstract: 
We provide a comprehensive assessment of the relationship between public debt and GDP growth in the postwar advanced economies. We use the timing of changes in public debt and growth to account for endogeneity, and find little evidence of a negative relationship. Semi-parametric estimates do not indicate any threshold effects. Finally, we reconcile our results with four recent, influential papers that found a substantial negative relationship, especially when public debt exceeds 90 percent of GDP. These earlier results appear to derive mostly from peculiar parametric specifications of nonlinearities, or use of small samples which amplify the influence of outliers.
Subjects: 
public debt
growth
JEL: 
E00
E6
H6
C82
Document Type: 
Working Paper

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