This study aims to highlight the empirical relationship between public debt and economic growth in Côte d’Ivoire using the Threshold Autoregressive (TAR) model over the period 1970-2018. The results obtained in the short run shed light on the no relationship between public debt and economic growth. In the long run, there is a bi-directional Granger causality between public debt and the sustainability of economic growth. Moreover, the non-linearity between the variables of interest has been explored and the results show the presence of a threshold effect: beyond 48.03 percent of GDP, any increase in public debt by 1% should reduce economic growth by 0.28%. Thus, the study questions the relevance of the West African Economic and Monetary Union (WAEMU) criterion set at 70% of GDP.
Author (S) Details
Dr. Koffi Pokou
Department of Economics, University Felix Houphouet-Boigny, Cocody, Abidjan, Côte d’Ivoire.
View Book :- https://stm.bookpi.org/MPEBM-V7/article/view/3630
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