Public Debt and Economic Growth in The SouthEast Asian Countries

Muhammad Ghafur Wibowo


This study examines the relationship between public debt and economic growth in eight countries in Southeast Asia that are members of ASEAN. Through the study will contribute reference for each country to establish their macroeconomic policies. Using 10 years of data from 2006 to 2015 and analysis tools Autoregression Vector (VAR), the study attempts to test the theory of finance led growth. The main finding of this study is that public debt is actually able to increase the economic growth of a country significantly, although it takes a few years of its existence. This finding supports several previous studies that demonstrate the important role of government debt to the economy of a country.

DOI: 10.15408/sjie.v6i1.4779


public debt; economic growth; gross domestic product; vector autoregression


Al-Refai., M.F. (2015). Debt and Economic Growth in Developing Countries: Jordan as a Case Study. International Journal of Economics and Finance. Vol. 7, No. 3:1 34-143.

Babu, J.O. (2014). External Debt and Economic Growth in the East Africa Community. African Journal of Business Management. Vol. 8(21): 1011-1018.

Beaugrand, Philippe, Boileau Loko, dan Montfort Mlachila. (2002). The Choice Between External and Domestic Debt in Financing Budget Deficits: The Case of Central and West African Countries”. IMF Working Paper, WP/02/79.

Bittencourt, Manoel. (2012). Economic Growth and Government Debt: Evidence from the Young Democracies of Latin America. Pretoria Working Paper, No. 03

Kemenkeu RI. (2003). Profil Utang Pemerintah Pusat (Pinjaman dan Surat Berharga Negara). Jakarta: Kemenkeu.

Mankiw, Gregory. (2000). Macroeconomics. 4th Edition, New York: Worth Publisher.

Mencinger, J. (2014). The Impact of Growing Public Debt on Economic Growth in the European Union. IER Working Paper No. 80.

Misztal, P. (2010). Public Debt and Economic Growth in the European Union. Journal of Appllied Economic Science, Vol. V/Issue 3 (13): 292-302.

Siddiqui, R. & A. Malik. (2001). Debt and Economic Growth in South Asia. The Pakistan Development Review. Vol. 40: 4: 677-688.

Samuelson, P.A. & W.D. Nordhaus. (1997). Makro Ekonomi. Jakarta: Erlangga.

Sukirno, S. (2008). Makroekonomi: Teori Pengantar. 3rd Ed. Jakarta: RajaGrafindo Persada.

Widarjono, A. (2013). Ekonometrika Pengantar dan Aplikasinya. Yogyakarta: Ekonesia-FEUII.

Full Text: PDF

DOI: 10.15408/sjie.v6i1.4779


  • There are currently no refbacks.