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Is external debt an effective way of bringing economic reforms?

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  • Gul, Adnan
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    Abstract

    This paper investigates the adverse effects of external debt on economic performance. In order to cater the issue of errors in mathematical model developed to analyze the correlation, this paper deals by performing a hypothetical analysis on economic growth within a country at different levels of external debt. The analysis is done on all sectors at the same time to ensure maximum accuracy. The paper concludes that debt itself is not an effective way of helping underdeveloped countries. This study adds in finding effective means which will allow underdeveloped countries to get a foothold on the development ladder of economy.

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    File URL: http://mpra.ub.uni-muenchen.de/10979/
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    Bibliographic Info

    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 10979.

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    Date of creation: 10 Sep 2008
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    Handle: RePEc:pra:mprapa:10979

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    Keywords: External Debt; Growth; Pakistan Economy; Debt overhang; Crowding out;

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    22. International Monetary Fund, 2002. "Financial Crises, Poverty, and Income Distribution," IMF Working Papers 02/4, International Monetary Fund.
    23. Hélène Poirson & Luca Antonio Ricci & Catherine A. Pattillo, 2002. "External Debt and Growth," IMF Working Papers 02/69, International Monetary Fund.
    24. Kneller, Richard & Bleaney, Michael F. & Gemmell, Norman, 1999. "Fiscal policy and growth: evidence from OECD countries," Journal of Public Economics, Elsevier, vol. 74(2), pages 171-190, November.
    25. Erwin Tiongson & Hamid Reza Davoodi & Sawitree S. Asawanuchit, 2003. "How Useful Are Benefit Incidence Analyses of Public Education and Health Spending," IMF Working Papers 03/227, International Monetary Fund.
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    28. William R. Cline, 1995. "International Debt Reexamined," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 46.
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