External Debts and Economic Growth when Debt Rating Matters

Autor:	Ly Dai Hung
Rok vydání:	2021
Předmět:	Economics and Econometrics Economic growth rate media_common.quotation_subject Developing country Sample (statistics) Monetary economics Fixed effects model External debt General Business Management and Accounting Debt Economics Bond credit rating Finance media_common Panel data
Zdroj:	Journal of International Commerce, Economics and Policy. 12
ISSN:	1793-9941 1793-9933
DOI:	10.1142/s1793993321500162
Popis:	The paper investigates the dependence pattern of economic growth on external debt supply by accounting for the safety of debts, measured by the sovereign debt rating. The method of cross-section regression is based on a sample of 145 advanced and developing economies with averaged data over the 1990–2019 period. The pattern of economic growth follows a U-shaped curve, for which the growth rate is first decreasing and then increasing on the external debt supply. A possible explanation can rely on the sovereign debt rating. For low supply of external debts, more supply of debts reduces the debt rating, which, in turn, lowers the economic growth rate. But for high enough supply of debts, more debts raise their rating, improving the growth rate. These results are robust on controlling for various determinants of economic growth and on the fixed effect panel regression.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::2b1db20566e2c2268afa0f60d37208d1 https://doi.org/10.1142/s1793993321500162 Zobrazit plný text záznamu