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Impact of Public Debt on Economic Growth-Case of the Republic of Kosovo

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  • Halilaj Arbenita

    (PhD student at University of Zagreb Faculty of Economics and Business, Zagreb, Croatia.)

Abstract

This paper aims to investigate the impact of public debt on the economic growth of the Republic of Kosovo through an econometric analysis using quarterly data for the available years from 2013 until 2022. The research data used in this paper originates from the Ministry of Finance of the Republic of Kosovo and the Kosovo Statistical Agency, using variables such as GDP per capita, Central Government Debt, and Government Spending in Euro units. The econometric analysis provides statistically significant variables in the long-run, thus confirming the validity of the long-run relationship between Public debt and the GDP. Such, confirms the Keynesian theory that the public debt impacts positively the economic growth in our case. Ultimately, the government is ought to use a well-planned investment and fiscal responsibility with attention to the acquired debt.

Suggested Citation

  • Halilaj Arbenita, 2024. "Impact of Public Debt on Economic Growth-Case of the Republic of Kosovo," Zagreb International Review of Economics and Business, Sciendo, vol. 27(2), pages 237-248.
    • Handle: RePEc:vrs:zirebs:v:27:y:2024:i:2:p:237-248:n:1011
    DOI: 10.2478/zireb-2024-0025
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    References listed on IDEAS

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    1. Ms. Anastasia Guscina & Mr. Olivier D Jeanne, 2006. "Government Debt in Emerging Market Countries: A New Data Set," IMF Working Papers 2006/098, International Monetary Fund.
    2. Benassy-Quere, Agnes & Coeure, Benoit & Jacquet, Pierre & Pisani-Ferry, Jean, 2010. "Economic Policy: Theory and Practice," OUP Catalogue, Oxford University Press, number 9780195322736.
    3. Anderson, Phillip R. D. & Silva, Anderson Caputo & Velandia-Rubiano, Antonio, 2010. "Public debt management in emerging market economies : has this time been different ?," Policy Research Working Paper Series 5399, The World Bank.
    4. Thomas R. Michl, 2013. "Public debt, growth, and distribution," Review of Keynesian Economics, Edward Elgar Publishing, vol. 1(1), pages 120-144, January.
    5. Etleva Bajrami, 2020. "The impact of public debt on economic growth in Albania," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 23(77), pages 20-27, September.
    6. Agim Berisha, 2023. "Public Debt and Financing in the Economy: The Case of Kosovo," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(2), pages 115-126.
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    More about this item

    Keywords

    Republic of Kosovo; Public Debt; Economic growth;
    All these keywords.

    JEL classification:

    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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