The Impact of Public Debt on Moroccan Economic Growth

Ardl Approach

Bibliographic Data

ID22001578
AuthorsMohamed AIT EL FAKIH (0000-0002-6447-4737, Selçuk University, corresponding author)
Year2021
Volume52
Issue52
Pages408-424
Publication date2021-01-01
Open AccessNo
TypeARTICLE
VenueThe Journal of Social Sciences (JOURNAL)
Journal identifiersISSN: 2149-0821 • E-ISSN: 2149-0821
PublisherASOS Yayinevi (PUBLISHER)
DOI10.29228/sobider.51523
OpenAlexW4249448405
LanguageEN
References cited4

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

Debt · Economics · Macroeconomics · Monetary economics · Fiscal Policies and Political Economy · Fiscal Policy and Economic Growth · Monetary Policy and Economic Impact

Tools

Open DOIOpen Access