DOI of the published preprint https://doi.org/10.1590/0103-6351/7461
Nonlinearities in the relationship between public debt and economic growth: an application to the Brazilian case
DOI:
https://doi.org/10.1590/0103-6351/7461Keywords:
Threshold Autoregressive, Markov Switching Regime, public debt, GDP growthAbstract
This article assesses the relationship between public debt and economic growth in Brazil between 2002Q4 and 2020Q4. The Autoregressive Threshold estimations suggest a tipping point for the country’s Gross Debt to GDP ratio of 84% of GDP, and for the Net Debt to GDP ratio of 59% of GDP, beyond which public indebtedness starts to put negative pressure on GDP growth. Non-linear effects of the debt to GDP ratio on output are also estimated, via Markov Switching Regime, for different levels of the Debt/GDP ratio. The results indicate that the transition from a low to a high debt to GDP ratio regime causes a reduction in the Brazilian GDP growth rate.
Downloads
Posted
How to Cite
Section
Copyright (c) 2023 Benito Adelmo Salomão Neto, Cleomar Gomes da Silva
This work is licensed under a Creative Commons Attribution 4.0 International License.
Plaudit
Data statement
-
The research data is available on demand, condition justified in the manuscript
