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In search of causality between debt and growth: a graph theoretic approach

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  • Nazmus Sadat Khan

    (Department of Economics, University of Muenster)

Abstract

This paper detects the direction of causality between government debt and economic growth in a multivariate framework using graph theoretic approach for six major OECD countries. The results show that growth causes debt in most countries. A comparison between the full sample and a reduced sample (leaving out the periods of recent financial crisis) indicates that the causal direction from growth to debt is a more recent phenomenon.

Suggested Citation

  • Nazmus Sadat Khan, 2016. "In search of causality between debt and growth: a graph theoretic approach," Economics Bulletin, AccessEcon, vol. 36(2), pages 677-687.
    • Handle: RePEc:ebl:ecbull:eb-15-00726
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    References listed on IDEAS

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    More about this item

    Keywords

    government debt; economic growth; graph theory; causality analysis;
    All these keywords.

    JEL classification:

    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • H6 - Public Economics - - National Budget, Deficit, and Debt

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