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Economic Growth and Public Indebtedness in the Last Four Decades: Is Portugal different from the other PIIGS’ economies?

Author

Listed:
  • Ferraz Ricardo

    (Lisbon School of Economics and Management, Lisbon, Portugal)

  • Duarte António Portugal

    (Faculty of Economics, University of Coimbra, Portugal)

Abstract

Portugal is a member of the group known by investors as ‘PIIGS’, countries characterised by having high public debt and weak economic growth. Using an extended time horizon, 1974–2014, this study seeks to empirically explore the relationship between economic growth and public debt in the PIIGS economies, particularly in the case of Portugal. Based on the estimation of linear regression models, it was concluded that in the last four decades there has been a negative relationship between economic growth and public debt in both cases, which is consistent with the literature. The negative relationship was even more pronounced in the case of the PIIGS than it was in the case of Portugal.

Suggested Citation

  • Ferraz Ricardo & Duarte António Portugal, 2015. "Economic Growth and Public Indebtedness in the Last Four Decades: Is Portugal different from the other PIIGS’ economies?," Naše gospodarstvo/Our economy, Sciendo, vol. 61(6), pages 3-11, December.
    • Handle: RePEc:vrs:ngooec:v:61:y:2015:i:6:p:3-11:n:1
    DOI: 10.1515/ngoe-2015-0021
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    References listed on IDEAS

    as
    1. Carmen M. Reinhart & Kenneth S. Rogoff, 2010. "Growth in a Time of Debt," American Economic Review, American Economic Association, vol. 100(2), pages 573-578, May.
    2. Checherita-Westphal, Cristina & Rother, Philipp, 2012. "The impact of high government debt on economic growth and its channels: An empirical investigation for the euro area," European Economic Review, Elsevier, vol. 56(7), pages 1392-1405.
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    Cited by:

    1. Pedro Bação & Sara Cerdeira & António Portugal Duarte, 2019. "Portugal in the Eurozone: Evolution and Expectations," Scientific Annals of Economics and Business (continues Analele Stiintifice), Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, vol. 66(si), pages 173-189, December.
    2. Saungweme, Talknice & Odhiambo, Nicholas M., 2020. "The Impact of Domestic and Foreign Public Debt on Economic Growth: Empirical Evidence from Zimbabwe," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 73(1), pages 77-106.

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    More about this item

    Keywords

    Economic Growth; Portugal; ‘PIIGS’; Public Debt; ekonomska rast; Portugalska; PIIGS; javni dolg;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • H6 - Public Economics - - National Budget, Deficit, and Debt

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