Growing Like Germany: Local Public Debt, Local Bank, Low Private Investment

2021 ◽  
Author(s):  
Mathias Hoffman ◽  
Iryna Stewen ◽  
Michael Stiefel
Keyword(s):  
Public Debt ◽  
Private Investment ◽  
Local Public Debt

scholarly journals Impact of Public Debt on the Economic Growth of Pakistan.

2011 ◽  
Vol 50 (4II) ◽  
pp. 599-615 ◽  
Author(s):  
Naeem Akram
Keyword(s):  
Economic Growth ◽  
Public Debt ◽  
Negative Relationship ◽  
Private Investment ◽  
Crowding Out ◽  
Per Capita Gdp ◽  
Debt Overhang ◽  
Positive Effects ◽  
Domestic Debt ◽  
Per Capita

Over the years Pakistan has failed to collect enough revenues for financing of its budget. Consequently, the problem of twin deficits emerged and to finance the developmental activities government has to rely on public external and domestic debt. The positive effects of public debt relate to the fact that in resource-starved economies debt financing if done properly leads to higher growth and adds to their capacity to service and repay public debt. The negative effects work through two main channels—i.e., ―Debt Overhang‖ and ―Crowding Out‖ effects. The present study examines the consequences of public debt for economic growth and investment in Pakistan for the period 1972-2009. It develops a hybrid model that explicitly incorporates the role of public debt in growth equations. As the some variables are I (1) and other are I (0) so Autoregressive Distributed Lag(ARDL) technique has been applied to estimate the model. Study finds that public external debt has negative relationship with per capita GDP and investment confirming the existence of ―Debt Overhang effect‖. However, due to insignificant relationships of debt servicing with investment and per capita GDP, the existence of the crowding out hypothesis could not be confirmed. Similarly, domestic debt has a negative relationship with investment and per capita GDP. In other words, it seems to have crowded out private investment. JEL classification: H63, O43, E22, C22 Keywords: Public Debt, Economic Growth, Investment, ARDL

scholarly journals Impact of Public Debt, Deficit and Debt Financing on Private Investment in a Large Country: Evidence from the United States

2020 ◽  
Vol 6 (2) ◽  
pp. 139-161
Author(s):  
Amir Kia
Keyword(s):  
Public Debt ◽  
Public Investment ◽  
Government Expenditure ◽  
Private Investment ◽  
Adjustment Costs ◽  
The United States ◽  
Direct Impact ◽  
Large Country ◽  
Long Run ◽  
Short Run

This paper analyses the direct impact of fiscal variables on private investment. The current literature ignores one or more fiscal variables and, in many cases, the foreign financing of debt. In this paper, an aggregate investment function for an economy in which firms incur adjustment costs in their investment process is developed. The developed model incorporates the direct impact of government expenditure, public debt and investment, deficits and foreign-financed debt on private investment. The model is tested on US data. It is found that public investment does not have any impact on private investment, but government expenditure, deficit, debt and foreign-financed debt crowd out private investment over the long run. However, deficit crowds in the private investment over the short run.

Local Public Debt in England and Wales

Economica ◽  
1935 ◽  
Vol 2 (6) ◽  
pp. 204
Author(s):  
Ursula K. Webb
Keyword(s):  
Public Debt ◽  
England And Wales ◽  
Local Public Debt

scholarly journals How foreign participation in the Colombian local public debt market has influenced domestic financial conditions

2021 ◽  
Vol 2 (4) ◽  
pp. 100043
Author(s):  
José Vicente Romero ◽  
Hernando Vargas ◽  
Pamela Cardozo ◽  
Andrés Murcia
Keyword(s):  
Public Debt ◽  
Financial Conditions ◽  
Debt Market ◽  
Local Public Debt

scholarly journals EFFECT OF PUBLIC DEBTS ON PRIVATE-SECTOR INVESTMENT IN NIGERIA

2021 ◽  
Vol 4 (1) ◽  
pp. 96-111
Author(s):  
Osuoha Chionyeka ◽  
◽  
Theresa Udenwa ◽  
Nneka Nwala ◽  
◽  
...  
Keyword(s):  
Private Sector ◽  
Error Correction ◽  
Public Debt ◽  
Private Investment ◽  
Ordinary Least Squares ◽  
Debt Service ◽  
Private Sector Investment ◽  
Domestic Debt ◽  
Private Investors ◽  
The Impact

This study empirically analyzed the effect of Public Debt and Private-Sector Investment in Nigeria (1986-2017). This study employed secondary data in the analysis. The study used the ordinary least square method (OLS) and Error Correction Model (ECM) tools of analysis in the investigation of the impact and relationship among the economic variables. The Ordinary Least Squares (OLS) and the Error Correction Models show that there is a strong relationship between Private Investment (PIVN)in Nigeria and Public Debt in Nigeria. Public Debt in Nigeria has a negative effect on the economy both in the short run and long run especially the Public Domestic Debt in Nigeria and Public External Debts in Nigeria. This is because the more government borrows from both the domestic and the external the more it crowds out investment especially the domestic debt crowds out private investment through lack of access to funds. The ECM result revealed that Public Debt Service in Nigeria has a positive effect on Private Investment (PIVN)in Nigeria, this is because when the government pays back loans or debts, it increases access to funds by the private investors thereby increasing the level of private investment in the country. Therefore, the study recommends that government should design a mechanism for effective and efficient Public Debt Service Management in Nigeria to increase access to funds by private investors and thereby increasing and enhancing Private Investment (PIVN) in Nigeria.

scholarly journals A Test of the validity of Crowding-out (or- in) hypothesis: A new examination of link between public borrowing and private investment in Emerging Europe

2021 ◽  
Vol 12 (1) ◽  
pp. 91-103
Author(s):  
Mehmed Ganic ◽  
Lejla Hodzic ◽  
Ognjen Ridic
Keyword(s):  
Public Debt ◽  
Private Investment ◽  
Transition Countries ◽  
Crowding Out ◽  
Debt Burden ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
Pooled Mean Group ◽  
Long Run ◽  
Short Run

This study seeks to test the existence of the crowding-out (or- in) hypothesis in a sample of 17 Emerging Europe countries divided in two panels. The study employs a panel autoregressive distributed lag (ARDL) model based on three estimators, Mean Group Estimator (MG), Pooled Mean Group (PMG) and Dynamic Fixed Effect (DFE), in order to evaluate the of stability of short run and long run coefficients using consistently compiled public borrowing and private investment data between 2000 and 2019. The empirical findings of the paper generally confirm the existence of a crowding out effect in both long run and short run in European post-transition countries, and in the long run for European transition countries. More specifically, elasticity of private investment with respect to public debt is greater in the European transition countries than in the European post-transition countries. However, the findings on the crowding out (in) effect of government spending and economic growth on private investment are mixed and conflicting in both the long run and the short run. Accordingly, the study recommends that selected countries should reassess their austerity agendas employed for lowering debt levels, and follow new strategies for managing public debt burden.

scholarly journals Journal of the History of Economic Thought Preprints - Keynes, Public Debt and the Complex of Interest Rates

2018 ◽  
Author(s):  
Anthony Aspromourgos
Keyword(s):  
Interest Rates ◽  
Term Structure ◽  
Public Debt ◽  
Public Investment ◽  
Private Investment ◽  
Economic Thought ◽  
History Of Economic Thought ◽  
John Maynard Keynes ◽  
History Of ◽  
Debt Market

John Maynard Keynes consistently offered qualified endorsement of Abba Lerner’s “functional finance” doctrine – the qualifications particularly turning on Keynes’s attentiveness to policy management of the psychology of the debt market. This article examines Keynes’s understanding of the possible influence of public debt on interest rates, from 1930 forward. With the multiplier a mechanism whereby debt-financed public investment generates matching private saving (net of private investment) plus public saving, it becomes possible for Keynes to conclude that increasing public debt need not place upward pressure on the level of interest rates, so long as policy can successfully manage the psychology of the debt market. This particularly concerns long interest rates and hence, the term structure of rates. His theory of the term structure enables Keynes’s conviction that policy can manage and shape long rates. The conclusion considers also whether Keynes’s caution concerning public debt and interest rates retains relevance today.

scholarly journals St. Lucia

2020 ◽  
Vol 20 (54) ◽  
Author(s):  
Keyword(s):  
Public Debt ◽  
Financial System ◽  
Private Investment ◽  
Infrastructure Investment ◽  
External Shocks ◽  
Growth Prospects ◽  
Near Term

St. Lucia’s near-term growth prospects are favorable, supported by large infrastructure investment and robust tourist inflows. However, longer-term growth continues to be impeded by high public debt, lingering vulnerabilities in the financial system, and structural impediments to private investment. Diminishing policy buffers further weaken the country’s resilience to external shocks against the backdrop of a precarious global outlook.

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