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Does the Reinhart-Rogoff Hypothesis Apply to China?

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Listed:
  • Yu Hsing

    (Southeastern Louisiana University)

Abstract

This paper finds that the threshold of the government debt ratio for China is 33.638%. A higher debt ratio would raise the growth rate if the debt ratio is up to 33.638% whereas a higher the debt ratio would reduce the growth rate if the debt ratio is greater than 33.638%. In addition, a higher ratio of employment change to GDP or a higher investment-to-GDP ratio raises the growth rate. Therefore, the debt threshold of 90% proposed by Reinhart and Rogoff does not apply to China.

Suggested Citation

  • Yu Hsing, 2020. "Does the Reinhart-Rogoff Hypothesis Apply to China?," Economics Bulletin, AccessEcon, vol. 40(4), pages 2663-2668.
    • Handle: RePEc:ebl:ecbull:eb-20-00666
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    fiscal policy; government debt; economic growth; Reinhart-Rogoff hypothesis;
    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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