scholarly journals Is Public Debt Harmful Towards Economic Growth? New Evidence from Sri Lanka

Staff Studies ◽  
2019 ◽  
Vol 49 (1) ◽  
pp. 51
Author(s):  
Thilak Ranjeewa Priyadarshana
Keyword(s):  
Economic Growth ◽  
Sri Lanka ◽  
Public Debt ◽  
New Evidence

Assessing Growth Impact of Public Debt in Sri Lanka

2020 ◽  
pp. 097674792091747
Author(s):  
Suvra Prokash Mondal ◽  
Biswajit Maitra
Keyword(s):  
Economic Growth ◽  
Sri Lanka ◽  
Public Debt ◽  
Extended Period ◽  
Asian Country ◽  
Policy Implications ◽  
Financial Variables ◽  
Domestic Debt ◽  
Fixed Capital Formation ◽  
The Impact

Whether public debt spurs economic growth is an unsettled issue in both theoretical and empirical grounds. The issue has attracted lots of attention to economists and policymakers in recent times. This article addresses the debt–growth issue in the case of a small emerging south Asian country—Sri Lanka. The impact of external, domestic debt, in association with a set of financial variables on income, is assessed for an extended period of 1965–2017, and also for the post-reform period of 1978–2017. The article finds some robust evidence that external debt is not beneficial; rather it depresses income. The impact of domestic debt and foreign aid on income is trivial. On the other hand, gross fixed capital formation and money supply spur income growth, whereas the impact of openness to trade is dismaying, and all these findings are invariant across the extended period and the post-reform periods. The results have policy implications for the long-term sustained economic growth of Sri Lanka. JEL: H63, F35, O40, C22

scholarly journals Public Debt and Economic Growth Nexus: Evidence from South Asia

2018 ◽  
Author(s):  
Saira Saeed ◽  
Tanweer Islam
Keyword(s):  
Economic Growth ◽  
Sri Lanka ◽  
South Asia ◽  
Public Debt ◽  
Developing Economies ◽  
Threshold Effect ◽  
The Public ◽  
Threshold Levels ◽  
Literature Evidence ◽  
The Relationship

It is well established in literature that the public debt and economic growth bear positive and non-linear relationship. However, in recent literature, evidence of no causal relationship is found when accounted for endogeneity in case of advanced economies (Panizza & Presbitero, 2014). Chudik, Mohaddes, Pesaran, & Raissi, (2017) analyse the data on forty countries and find no evidence of universally applicable threshold effect in the relationship between debt and growth. These advancements in the debt-growth literature provides the motivation to re-explore the relationship between public debt and economic growth under non-linearity and endogeneity in context of developing economies of South Asia including Pakistan, India, Bangladesh and Sri-Lanka for the period 1980-2014. There exists a significant, positive but nonlinear relationship between the public debt and economic growth for the selected set of developing countries when accounted for endogeneity and non-linearity. The negative association between the public debt and economic growth for SAARC region is found when the debt level is higher than 61% of GDP which is quite lower than developed economies (90% of GDP). Individual threshold levels for debt-to-GDP ratio divulge that Sri Lanka, Pakistan and India need to control their public borrowings as their current debt levels are higher and/or around the respective threshold levels.

scholarly journals Is public debt harmful towards economic growth? New evidence from South Africa

2019 ◽  
Vol 7 (1) ◽  
pp. 1603653 ◽  
Author(s):  
N. Mhlaba ◽  
A. Phiri ◽  
Christian Nsiah
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Public Debt ◽  
New Evidence

scholarly journals Long Run Association between Public Debt and Economic Growth in Sri Lanka

2018 ◽  
Vol 09 (04) ◽  
pp. 775-789 ◽  
Author(s):  
Munasinghe Arachchige Achala Munasinghe ◽  
A. M. C. P. Attapattu ◽  
H. M. N. Padmasiri
Keyword(s):  
Economic Growth ◽  
Sri Lanka ◽  
Public Debt ◽  
Long Run

Globalization, Poverty, Environmental Degradation and Economic Growth Nexus: Empirical Analysis of SAARC Regions

2020 ◽  
Vol 39 (1) ◽  
Author(s):  
Adiqa Kiani ◽  
Ejaz Ullah ◽  
Khair Muhammad
Keyword(s):  
Economic Growth ◽  
Sri Lanka ◽  
Empirical Analysis ◽  
Environmental Degradation ◽  
Negative Relationship ◽  
Policy Makers ◽  
Significant Negative Relationship ◽  
The Impact

The main objective of this study is to investigate the impact of poverty, globalization, and environmental degradation on economic growth in the selected SAARC countries. This study is employed panel Autoregressive Distributive Lag (ARDL) technique for empirical analysis using selected SAARC regions including India, Pakistan, Bangladesh, Nepal and Sri Lanka over the period of 1980 to 2018. Globalization impacts economic growth positively and significantly.  In addition to this the significant negative relationship is found between population and economic growth. The results show that poverty is positively related with environmental degradation. Furthermore, the results indicate that globalization is positively and significantly associated with environmental degradation in the SAARC region. Finally, the results show that urbanization is positive and significantly associated with environmental degradation, which could be the serious concerns for the policy makers to control.

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