HomeDespre ECTAEventsPolitica editorialaTrimite un articolParteneri / link-uri utileArchiveAbonamentContact

ISSN 1841-8678   (print)
ISSN 1844-0029   (online)


Archive ECTAP

Note: for the period 1994-2003 the archive of the magazine will not be available online

Supplements ECTAP

If you cannot open the pdf file you need Adobe Reader.
download Adobe Reader

Creative Commons License

Theoretical and Applied Economics
No. 3 / 2020 (624), Autumn

The effect of external debt on long run economic growth in developing economies: Evidence from heterogeneous panel data models with cross sectional dependency

Muhammed BENLI
Bilecik Seyh Edebali University, Turkey

Abstract. In this paper, we attempt to empirically investigate the impact of foreign debt growth and inflation on long-run economic growth in 35 developing economies over the period 1987-2017. Taking into account heterogeneity and cross-sectional dependence that may present in our panels, we employ cross-sectionally augmented autoregressive distributed lag (CS-ARDL) and crosssectional augmented distributed lag (CS-DL) estimators as well as the traditional panel data estimators such as the dynamic fixed effect (DFE), mean group (MG), and pooled mean group (PMG) estimators. The empirical evidence provided by selected estimators suggests the deteriorating effects of both external debt and inflation on long-run economic growth in the selected countries for the study period. Overall, our analyses provide tentative policy implications for developing economies for managing foreign borrowing and, if necessary, discouraging excessive external borrowing of both the private and public sectors.

Keywords: external debt, inflation, economic growth, panel data models, cross-sectional dependence.

Download the full article:  


Open acces




The Economicity. The Epistemic Landscape, Marin Dinu, 2016


ISSN 1841-8678 (ediția print) / ISSN 1844-0029 (ediția online)
© Copyright Asociația Generală a Economiștilor din România / Editura Economică
Redacția: Oficiul poștal 18, Ghișeul 3 - Căsuța poștală 31, București 014820, E-mail:

© 2006-2024 Theoretical and Applied Economics