{"id":6772,"date":"2021-10-06T10:44:15","date_gmt":"2021-10-06T02:44:15","guid":{"rendered":"https:\/\/www.ukm.my\/jem\/?post_type=article&#038;p=6772"},"modified":"2022-07-27T06:37:45","modified_gmt":"2022-07-26T22:37:45","slug":"the-effect-of-foreign-debt-on-the-economic-growth","status":"publish","type":"article","link":"https:\/\/www.ukm.my\/jem\/article\/the-effect-of-foreign-debt-on-the-economic-growth\/","title":{"rendered":"The Effect of Foreign Debt on the Economic Growth"},"content":{"rendered":"<p><em>This study examines the effect of foreign debt on the economic growth. Using a time series Indonesian data over 1981 &#8211; 2017, we employ the Error Correction Model based on the debt overhang theory. Foreign debt was found to produce negative and significant effect on the economic growth both in the short- and long-run. The paper further found that Foreign Direct Investment (FDI) improves the economic growth. Foreign debt that continues to increase drastically in the long-run could slow down the economic growth which may indicate the economy experiencing a debt overhang. It is thus imperative for the government to ensure the debt ratio remain below a certain threshold. Further, foreign debt should be prioritized to develop infrastructure with a broad multiplier effect and the FDI likewise prioritized for labor-intensive sectors.<\/em><\/p>\n","protected":false},"template":"","tags":[186,606,1352,426,387],"jel-code":[1353,1354,1355],"article-type":[1329],"class_list":["entry","author-asriwn","post-6772","article","type-article","status-publish","tag-economic-growth","tag-error-correction-model","tag-foreign-debt","tag-foreign-direct-investment","tag-indonesia","jel-code-e22","jel-code-f34","jel-code-o47","article-type-normal-article"],"_links":{"self":[{"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/article\/6772","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/article"}],"about":[{"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/types\/article"}],"version-history":[{"count":1,"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/article\/6772\/revisions"}],"predecessor-version":[{"id":6776,"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/article\/6772\/revisions\/6776"}],"wp:attachment":[{"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/media?parent=6772"}],"wp:term":[{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/tags?post=6772"},{"taxonomy":"jel-code","embeddable":true,"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/jel-code?post=6772"},{"taxonomy":"article-type","embeddable":true,"href":"https:\/\/www.ukm.my\/jem\/wp-json\/wp\/v2\/article-type?post=6772"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}