Caribbean development report: A perusal of public debt in the Caribbean and its impact on economic growth
This paper examines the genesis and evolution of debt and debt overhang in the Caribbean with individual case studies, to extract lessons and make broad recommendations with regard to appropriate mechanisms and policy measures that can be implemented to reduce the debt burden of the subregion. The e...
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ECLAC, Subregional Headquarters for the Caribbean
2018
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oai-11362-433122020-09-28T19:14:27Z Caribbean development report: A perusal of public debt in the Caribbean and its impact on economic growth McLean, Sheldon Charles, Don DEUDA PUBLICA CRECIMIENTO ECONOMICO POLITICA FISCAL CRISIS FINANCIERA ALIVIO DE LA DEUDA REESTRUCTURACION DE LA DEUDA ELABORACION DE POLITICAS CAMBIO CLIMATICO ESTRATEGIAS DEL DESARROLLO MODELOS ECONOMETRICOS ESTUDIOS DE CASOS RECOMENDACIONES PUBLIC DEBT ECONOMIC GROWTH FISCAL POLICY FINANCIAL CRISIS DEBT RELIEF DEBT RESTRUCTURING POLICY-MAKING CLIMATE CHANGE DEVELOPMENT STRATEGIES ECONOMETRIC MODELS CASE STUDIES RECOMMENDATIONS This paper examines the genesis and evolution of debt and debt overhang in the Caribbean with individual case studies, to extract lessons and make broad recommendations with regard to appropriate mechanisms and policy measures that can be implemented to reduce the debt burden of the subregion. The econometric model utilized in the paper has shown that a one percent increase on debt to GDP ratio causes a 0.015decline in real GDP growth for the countries in the Caribbean panel, suggesting that debt has a pernicious effect on growth on Caribbean economies. What is even more worrisome was that Caribbean economies did not demonstrate the traditional non-linear (bell-shaped) effect of debt on growth, where there is a range in which a positive relation between debt and growth exists. Traditionally, as debt increases, so does economic growth, up to a point. After this maximum point is passed, the relationship turns negative, where increases in debt cause a decrease in economic growth. In contrast, using the Caribbean countries selected in the panel over the period 2000-2015, it was empirically found that, at all levels, increases in debt resulted in a decline in economic growth for Caribbean economies. It was also shown that the financial crisis negatively affected growth in the Caribbean, lending credence to the view that Caribbean economies are exceedingly vulnerable to exogenous economic shocks. Abstract. -- Introduction. -- I. An examination of Caribbean. -- II. An overview of Caribbean efforts at debt reduction. -- III. Empirical examination of influence of debt on growth in select Caribbean economies. -- IV. Conclusion and way forward. -- Bibliography. 2018-02-26T18:05:00Z 2018-02-26T18:05:00Z 2018-01-31 Texto Documento Completo http://hdl.handle.net/11362/43312 LC/CAR/TS.2017/18 LC/TS.2017/157 en Studies and Perspectives Series – The Caribbean 70 .pdf application/pdf CARIBE ANTIGUA Y BARBUDA BELICE BARBADOS DOMINICA GRANADA GUYANA JAMAICA SAINT KITTS Y NEVIS CARIBBEAN REGION ANTIGUA AND BARBUDA BARBADOS BELIZE DOMINICA GRENADA GUYANA JAMAICA SAINT KITTS AND NEVIS ECLAC, Subregional Headquarters for the Caribbean |
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Cepal |
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English |
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DEUDA PUBLICA CRECIMIENTO ECONOMICO POLITICA FISCAL CRISIS FINANCIERA ALIVIO DE LA DEUDA REESTRUCTURACION DE LA DEUDA ELABORACION DE POLITICAS CAMBIO CLIMATICO ESTRATEGIAS DEL DESARROLLO MODELOS ECONOMETRICOS ESTUDIOS DE CASOS RECOMENDACIONES PUBLIC DEBT ECONOMIC GROWTH FISCAL POLICY FINANCIAL CRISIS DEBT RELIEF DEBT RESTRUCTURING POLICY-MAKING CLIMATE CHANGE DEVELOPMENT STRATEGIES ECONOMETRIC MODELS CASE STUDIES RECOMMENDATIONS |
| spellingShingle |
DEUDA PUBLICA CRECIMIENTO ECONOMICO POLITICA FISCAL CRISIS FINANCIERA ALIVIO DE LA DEUDA REESTRUCTURACION DE LA DEUDA ELABORACION DE POLITICAS CAMBIO CLIMATICO ESTRATEGIAS DEL DESARROLLO MODELOS ECONOMETRICOS ESTUDIOS DE CASOS RECOMENDACIONES PUBLIC DEBT ECONOMIC GROWTH FISCAL POLICY FINANCIAL CRISIS DEBT RELIEF DEBT RESTRUCTURING POLICY-MAKING CLIMATE CHANGE DEVELOPMENT STRATEGIES ECONOMETRIC MODELS CASE STUDIES RECOMMENDATIONS McLean, Sheldon Charles, Don Caribbean development report: A perusal of public debt in the Caribbean and its impact on economic growth |
| description |
This paper examines the genesis and evolution of debt and debt overhang in the Caribbean with individual case studies, to extract lessons and make broad recommendations with regard to appropriate mechanisms and policy measures that can be implemented to reduce the debt burden of the subregion. The econometric model utilized in the paper has shown that a one percent increase on debt to GDP ratio causes a 0.015decline in real GDP growth for the countries in the Caribbean panel, suggesting that debt has a pernicious effect on growth on Caribbean economies. What is even more worrisome was that Caribbean economies did not demonstrate the traditional non-linear (bell-shaped) effect of debt on growth, where there is a range in which a positive relation between debt and growth exists. Traditionally, as debt increases, so does economic growth, up to a point. After this maximum point is passed, the relationship turns negative, where increases in debt cause a decrease in economic growth. In contrast, using the Caribbean countries selected in the panel over the period 2000-2015, it was empirically found that, at all levels, increases in debt resulted in a decline in economic growth for Caribbean economies. It was also shown that the financial crisis negatively affected growth in the Caribbean, lending credence to the view that Caribbean economies are exceedingly vulnerable to exogenous economic shocks. |
| format |
Texto |
| author |
McLean, Sheldon Charles, Don |
| author_facet |
McLean, Sheldon Charles, Don |
| author_sort |
McLean, Sheldon |
| title |
Caribbean development report: A perusal of public debt in the Caribbean and its impact on economic growth |
| title_short |
Caribbean development report: A perusal of public debt in the Caribbean and its impact on economic growth |
| title_full |
Caribbean development report: A perusal of public debt in the Caribbean and its impact on economic growth |
| title_fullStr |
Caribbean development report: A perusal of public debt in the Caribbean and its impact on economic growth |
| title_full_unstemmed |
Caribbean development report: A perusal of public debt in the Caribbean and its impact on economic growth |
| title_sort |
caribbean development report: a perusal of public debt in the caribbean and its impact on economic growth |
| publisher |
ECLAC, Subregional Headquarters for the Caribbean |
| publishDate |
2018 |
| url |
http://hdl.handle.net/11362/43312 |
| work_keys_str_mv |
AT mcleansheldon caribbeandevelopmentreportaperusalofpublicdebtinthecaribbeananditsimpactoneconomicgrowth AT charlesdon caribbeandevelopmentreportaperusalofpublicdebtinthecaribbeananditsimpactoneconomicgrowth |
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