Presentation of project results: Political economy of public debt, growth and interest rates in the context of the Corona crisis

13  September 2023    10:00 am CEST

Philipp Heimberger (wiiw)

Venue

wiiw, Souterrain, Rahlgasse 3, 1060 Vienna

Description

On the occasion of the project finalisation 'Political economy of public debt, growth and interest rates in the context of the Corona crisis', we hereby invite you to the presentation of the results.

The macroeconomic consequences of the Corona crisis have triggered an increase in public debt in the EU’s Member States. This research project made two contributions to a better understanding of the implications for economic policy. First, we developed the first quantitative analysis of the literature concerning the effect of public debt on economic growth. Using the statistical and econometric toolbox of meta-analysis and meta-regression analysis, we investigated whether there was evidence for a threshold effect of the public-debt-to-GDP ratio, whereby economic growth declined significantly if such a threshold was exceeded. Second, the project developed an analysis of government debt against the background of changes in the interest rate environment. Specifically, we analysed the role of the difference between long-term interest rates on government bonds and GDP growth rates for the dynamics of government debt and fiscal policy.

Programme

10:00 - 10:05 Welcome & Introduction       
Robert Stehrer (Scientific Director, wiiw)       

10:05 - 10:40 Presentation of the results
Philipp Heimberger (wiiw)    

  • Study: Do Higher Public Debt Levels Reduce Economic Growth?  
  • Study: Public debt and r-g risks in advanced economies: Eurozone versus stand-alone

10:40 - 11:00  Q&A and Discussion
Moderation: Robert Stehrer (wiiw)   

This event takes place in the framework of the project 'Political economy of public debt, growth and interest rates in the context of the Corona crisis' which is financed by the Anniversary Fund of the Oesterreichische Nationalbank (Project No.18699). Support provided by Oesterreichische Nationalbank for this research is gratefully acknowledged.   

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