Economic Growth In The Stability Of The Nation With Taxes And The Important Role Of Foreign Direct Investment

Sasongko, Budi

doi:10.54204/tmji/vol412022005

Cited by 1 publication

(1 citation statement)

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“…They claim that the threshold is 90% of the debt to GDP ratio. However, this study has been criticized for methodological and computational errors [12] Another study using panel data is Asteriou, Pilbeam, & Pratiwi [13], who find that there is a negative relationship between initial public debt and subsequent economic growth, with a smaller effect in developed countries. They also found that there is a nonlinear threshold around 85% of the debt-to-GDP ratio.…”

Section: Ease Of Usementioning

confidence: 96%

Public Debt and Macroeconomic Dynamics: A Simulation Model with Variables of Interest Rate, Economic Growth, Domestic Consumption, Government Expenditure, and Net Exports

Viphindrartin,

Wilantari,

Zainuri

et al. 2023

Advances in Economics, Business and Management Research

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This research explores causal relationships among public debt, interest rates, economic growth, domestic consumption, government spending, and net exports. It employs a panel vector model to investigate these relationships, assuming that all variables are endogenous and influenced by their own past values and those of other variables. The findings indicate that public debt negatively affects most variables, suggesting it hinders the economies of Indonesia, the Philippines, Malaysia, and Thailand. Rising interest rates also disrupt exports in ASEAN member countries. Surprisingly, government spending increases public debt. Consumption in these regions encourages exports through international trade agreements, and exports, in turn, boost government spending and state income. Economic growth, as measured by GDP, drives all variables, underscoring its role in both the monetary and real sectors of these economies. However, it's important to note that data availability and the research period were limitations. Based on the results, it's recommended that the government exercise caution in increasing public debt and balance short-term economic pressures with long-term economic drivers to mitigate debt's impact on the economy.

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Section: Ease Of Usementioning

confidence: 96%