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On the relationship between economic growth and government debt for Bulgaria. Test of the Reinhart-Rogoff hypothesis

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  • Yu HSING

    (Southeastern Louisiana University, USA)

Abstract

Based on an extended production function, this paper finds that the turning point of the government debt ratio for Bulgaria is estimated to be 45.2631%, suggesting that an increase in the debt ratio beyond 45.2631% will cause the growth rate of real GDP to decline. This turning point for Bulgaria is far less than the 90% turning point proposed by Reinhart and Rogoff. Therefore, the Reinhart-Rogoff hypothesis does not apply to Bulgaria.

Suggested Citation

  • Yu HSING, 2020. "On the relationship between economic growth and government debt for Bulgaria. Test of the Reinhart-Rogoff hypothesis," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(4(625), W), pages 187-194, Winter.
    • Handle: RePEc:agr:journl:v:4(625):y:2020:i:4(625):p:187-194
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    References listed on IDEAS

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