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The impact of government debt and fintech on economic growth: Evidence from low-income countries

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  • Mohammed, Sulaiman Abdullah Saif Alnasser
  • Khojally, Hytham MA

Abstract

This study examines the impact of government debt on economic growth in low-income countries, with a particular focus on the role of financial technology. Using a balanced panel of 18 low-income countries covering the period 2000–2022, the analysis employs quantile regression as the primary estimation technique, with Dynamic Ordinary Least Squares (DOLS) used for validation. The analysis was performed using a Python 3 environment. The results reveal that government debt exerts a consistently negative effect on economic growth across most income quantiles. Furthermore, the interaction between government debt and financial technology does not mitigate the negative growth effect of rising public debt, suggesting that financial technology alone is insufficient to offset structural fiscal weakness in low-income economies. These findings highlight the importance of prudent debt management, institutional strengthening, and productive use of public borrowing. A sound fiscal framework should therefore complement policies that promote the adoption of financial technology to support sustainable economic growth.

Suggested Citation

  • Mohammed, Sulaiman Abdullah Saif Alnasser & Khojally, Hytham MA, 2026. "The impact of government debt and fintech on economic growth: Evidence from low-income countries," Economic Analysis and Policy, Elsevier, vol. 91(C), pages 178-191.
    • Handle: RePEc:eee:ecanpo:v:91:y:2026:i:c:p:178-191
    DOI: 10.1016/j.eap.2026.03.013
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