Μία μελέτη της σχέσης δημοσίου χρέους και οικονομικής ανάπτυξης στις χώρες του ΟΟΣΑ

Λουλούδη, Κωνσταντίνα Γ.

A study of a relationship of public debt and economic growth in OECD countries

Master Thesis

Author

Λουλούδη, Κωνσταντίνα Γ.

Date

2014-09-17

Abstract

This thesis has as thematic core the investigation of the effect and the relationship between debt and economic growth. More specifically, investigates the average impact of government debt on GDP per capita growth in seven countries of the Organization of Economic Cooperation and Development (OECD) over a period of about 33 years starting in 1980. To achieve the purpose of working, reference will be made to the definition of public debt, the recent trends regarding public debt and analyze the factors associated with economic developments. We collected the data from the World Bank, the OECD and the International Monetary Fund and with the help of the statistical package Stata they were analyzed and estimated by the method of Fixed Effects. Having as dependent variable the growth rate of GDP per capita annually we observed that government debt is not a statistically significant variable in contrast with investment, population growth, inflation in terms of GDP deflator, government consumption, lending rate and the total imports and exports as a percentage of GDP which are statistically significant variables in explaining economic growth. Contrarily, in case we have as dependent variable the growth rate of GDP per capita (cumulatively for 5 years) we observe that government debt is a statistically significant variable since economic cycles have been eliminated. The issue of the impact of public debt on economic growth has been analyzed by a growing number of empirical studies which tend to show that there is a negative relationship between the two variables. The findings are in accordance with the studies of Schclarek (2004) and Yoldas (2013) since in annual basis, we observe a negative effect of government debt on economic growth but not a demonstrated statistically significant relationship and in line with the study of Reinhart and Rogoff (2010) and Checherita and Rother (2010) on cumulative 5-year basis, government debt is a statistically significant variable that negatively affects economic growth.