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Rising Public Debt to GDP Can Harm Economic Growth

March 2018

Alexander Chudik, Kamiar Mohaddes, M. Hashem Pesaran and Mehdi Raissi

Abstract: The debt–growth relationship is complex, varying across countries and affected by global factors. While there is no simple universal threshold above which debt to GDP significantly depresses growth, high and rising public debt burdens slow growth in the long term, data from the past four decades indicate.

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