Arbeitspapier
Does public debt crowd out corporate investment? International evidence
Using data for advanced and emerging economies, we show that there is a negative correlation between public debt and corporate investment. Industry-level regressions show that high levels of government debt are particularly damaging for industries that need more external financial resources. Firm-level regressions show that government debt increases the sensitivity of corporate investment to cash flow. These results indicate that the relationship between public debt and investment is likely to be causal and that public debt crowds out corporate investment by tightening credit constraints.
- Language
-
Englisch
- Bibliographic citation
-
Series: Graduate Institute of International and Development Studies Working Paper ; No. HEIDWP08-2018
- Classification
-
Wirtschaft
Investment; Capital; Intangible Capital; Capacity
Fiscal Policy
National Debt; Debt Management; Sovereign Debt
- Subject
-
Investment
Public Debt
Crowding Out
Credit Constraints
- Event
-
Geistige Schöpfung
- (who)
-
Huang, Yi
Panizza, Ugo
Varghese, Richard
- Event
-
Veröffentlichung
- (who)
-
Graduate Institute of International and Development Studies
- (where)
-
Geneva
- (when)
-
2018
- Handle
- Last update
-
10.03.2025, 11:41 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Huang, Yi
- Panizza, Ugo
- Varghese, Richard
- Graduate Institute of International and Development Studies
Time of origin
- 2018
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