engleski

An Empirical Analysis of the Public Debt Relevance to the Economic Growth of the USA

The aim of this paper is to assess, through empirical analysis, the historical significance of the public debt to the economic growth of the USA. In order to understand the relationship we examine the historical data from 1850 – 2010, as well as the quarterly data from the period 1966 – 2016. We used Johansen and Engle-Granger Co- integration tests, as well as Granger causality tests and Autoregressive Distributed Lag (ARDL) analysis. The empirical evidence of a statistically significant negative long-term relationship between public debt and GDP was not found. It is concluded that there is a uni- variate relationship GDP towards the public debt, which is caused by the constant rise in public debt.

public debt ; ARDL analysis ; economic growth ; the USA ; Engle-Granger cointegration tests

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