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Cited by 81Fiscal Policies and Political EconomyMonetary Policy and Economic ImpactGlobal Financial Crisis and Policies

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External debt and growth: role of stable macroeconomic policies

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Dey, Sima Rani, Tareque, Mohammad·2020·Journal of Economics, Finance and Administrative Science
DOI 10.1108/jefas-05-2019-0069
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Abstract

Purpose: This study aims to examine the impact of external debt on economic growth in Bangladesh within a broader macroeconomic scenario. Design/methodology/approach: In the process of doing so, it assesses the empirical cointegration, long-run and short-run dynamics of the concerned variables for the period of 1980–2017 applying the autoregressive distributed lag (ARDL) bounds testing approach to cointegration. First, debt-gross domestic product linkage explores the impact of external debt impact on economic growth using a set of macro and country risk variables, and then this linkage is also analyzed along with a newly formed macroeconomic policy (MEP) variable using principal component analysis. Findings: The study results reveal the negative impact of external debt on GDP growth, but the larger positive impact of MEP index indicates that this adverse effect of debt can be mitigated or even nullified by sound MEP and appropriate human resource policy. Originality/value: The dynamic effects of different shocks (external debt and macro policy variable) on economic growth by vector autoregression impulse response function also confirm our ARDL findings.

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Figure 9. Response of LGDP to MEP
Figure 9. Response of LGDP to MEPCC-BY · From the PDF
Figure 11 . Figure 11. Response of LGDP to LSER
Figure 11 . Figure 11. Response of LGDP to LSERCC-BY · From the PDF

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Research works printed but not linked: 43

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Metadata

Authors
Dey, S. R., & Tareque, M.
Affiliations
Bangladesh Institute of Governance and Management (BD)
Corresponding author
Dey, Sima Rani
ORCID
Venue
Journal of Economics, Finance and Administrative Science
Publisher
Emerald
Published
2020-07-28
Volume
25
Issue
50
Pages
185-204
ISSN
  • 2077-1886 (ISSN-L)
  • 2218-0648
DOI
10.1108/jefas-05-2019-0069
OpenAlex
W3045679800
Cited by
81
References
0
Citations by year
2026: 11 · 2025: 16 · 2024: 21 · 2023: 15 · 2022: 10 · 2021: 8
FWCI
6.64
Type
journal article
Language
en
Open access
Licence
cc-by
Locations
  • Journal of Economics Finance and Administrative Science (publishedVersion, cc-by)
  • LA Referencia (Red Federada de Repositorios Institucionales de Publicaciones Científicas) (submittedVersion, cc-by)
  • RePEc: Research Papers in Economics (submittedVersion)
  • DOAJ (DOAJ: Directory of Open Access Journals) (submittedVersion, cc-by-sa)
  • Econstor (Econstor) (submittedVersion, cc-by)
Topics
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Fiscal Policies and Political Economy
  • Social Sciences › Economics, Econometrics and Finance › General Economics, Econometrics and Finance › Monetary Policy and Economic Impact
  • Social Sciences › Economics, Econometrics and Finance › Finance › Global Financial Crisis and Policies
Keywords
external debt, economic growth, macroeconomic policy, debt-growth nexus, country risk, personnel policy, Bangladesh, policy shocks

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