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External debt, growth and investment for developing countries : some evidence for the debt overhang hypothesis
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Autores
Orientador(es)
Resumo(s)
We investigate the effect of total, public, and private external debt stocks on the growth
rate and also on total, government, and private investment by using data for a large
sample of developing countries. We find a significant and negative growth effect of
total external debt stock, lending evidence for the debt overhang argument. Moreover,
our results importantly indicate that external debt lowers growth only in countries with
ethnically fractionalized and ineffective governments. Furthermore, our empirical findings don’t support the existence of a non-linear or threshold relationship between
external debt and growth. Similar to the growth effects of external debt, the significantly and negatively estimated coefficients on the three measures of external debt
stocks imply that external debt reduces investment, again providing a robust evidence
for the debt overhang argument. Finally, our estimations show that private investment
level is more sensitive to the government external debt than the private external debt.
Descrição
Palavras-chave
Public and private external debt Growth Investment Debt overhang
Contexto Educativo
Citação
Turan, Taner e Halit Yanıkkaya (2021). "External debt, growth and investment for developing countries : some evidence for the debt overhang hypothesis". Portuguese Economic Journal, 20(3):319-341
Editora
Springer