Year: 2021
Type: article
Abstract: In this study, we investigate the impact of public debt (External-domestic debts) on Moroccan economic growth in both the short and long run during the period time of 1998-2018 drawing on The ARDL (Autoregressive Distributed Lag Bound test) model. The ARDL approach aims to test the existence of a long-run relationship among the variables included in a model. The results show that external debt has a negative and statistically significant effect on economic growth in both the long and short run. In addition, domestic debt has a negative and statistically significant impact on economic growth in the short run. Nonetheless, it has a negative and insignificant influence on economic growth in the long run. Moreover, it can be perceived from the Granger causality test that there is only one unidirectional causality running from GDP per capita to External debt. Based on the findings, we concluded that the government should minimize public debt in order to improve economic growth. To put it another way, the Moroccan government should seek techniques or strategies for reducing debt, or the debt borrowed by the government should be utilized properly, such as using debt to encourage and stimulate investments and therefore accelerate economic growth.
Source: The Journal of Social Sciences
Author: Mohamed AIT EL FAKIH
Institution: Selçuk University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: bronze
OpenAlex ID: W4249448405