External debt and economic growth

The case of emerging economy

Sami Al Kharusi, Mbah Stella Ada

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

This study investigated the relationship between government external borrowing and economic growth, prompted by continuous increases in Oman’s external debt to finance its annual budget. Time series data for the period 1990~2015 were collected from the World Bank and the Central Bank of Oman. The study employed the Autoregressive Distributed Lag cointegration approach explain the error correction mechanism to ascertain the short-run dynamic nature of external debt and economic growth. Consistent with some existing empirical evidence, the study reveals a negative and significant influence of external debt on economic growth in Oman. Further, gross fixed capital was found to be positively significant in determining growth performance in Oman. The study, therefore, recommends a more productive use of the external debt fund in order to affect positive growth.

Original languageEnglish
Pages (from-to)1141-1157
Number of pages17
JournalJournal of Economic Integration
Volume33
Issue number1
DOIs
Publication statusPublished - Mar 1 2018

Fingerprint

Emerging economies
External debt
Economic growth
Oman
Cointegration
Borrowing
Positive affect
Error correction mechanism
Central bank
World Bank
Finance
Fixed capital
Government
Empirical evidence
Time series data
Distributed lag
Short-run

Keywords

  • Economic growth
  • External debt
  • Government investment
  • Oman
  • Public investment

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)

Cite this

External debt and economic growth : The case of emerging economy. / Al Kharusi, Sami; Ada, Mbah Stella.

In: Journal of Economic Integration, Vol. 33, No. 1, 01.03.2018, p. 1141-1157.

Research output: Contribution to journalArticle

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