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Exploring the Nexus of Domestic Debt and Private Sector Credit in Developing Countries with a Focus on Bangladesh

Author

Listed:
  • Atia Ahmed
  • Kaniz Habiba Afrin
  • Anima Karmakar
  • Tamal Chakrobortty

Abstract

This research examines domestic debt, private sector lending, and economic development in emerging countries, focusing on Bangladesh. This analysis uses 1960–2022 Bangladeshi secondary data, World Bank World Development Indicators and Bangladesh Ministry of Finance economic statistics. Domestic debt and private sector credit affect emerging nations' economic development, according to this study's theoretical approach. This research examines the link between two factors to add to the literature and provide Bangladesh-specific insights. It is quantitative research that examines domestic debt, private sector credit, and economic development using regression analysis and statistical testing. The conclusions aids Bangladesh's economic development policymakers, economists, and stakeholders. Understanding national debt, financing from the private sector, and the advancement of the country's economy helps policymakers manage debt, allocate credit, and set economic policy. The conducted study also improves theoretical understanding of economic development in underdeveloped countries and illuminates Bangladesh's unique conditions. It examined household debt, private sector lending, and Bangladeshi economic development as well as examines the patterns of economic growth in emerging nations to enhance policy debates and broaden knowledge.

Suggested Citation

  • Atia Ahmed & Kaniz Habiba Afrin & Anima Karmakar & Tamal Chakrobortty, 2023. "Exploring the Nexus of Domestic Debt and Private Sector Credit in Developing Countries with a Focus on Bangladesh," International Journal of Finance & Banking Studies, Center for the Strategic Studies in Business and Finance, vol. 12(2), pages 67-75, June.
    • Handle: RePEc:rbs:ijfbss:v:12:y:2023:i:2:id:2796
    DOI: 10.20525/ijfbs.v12i2.2796
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    References listed on IDEAS

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    1. Sonia Afrin Ale & Md Shafiqul Islam & Hazera-Tun Nessa, 2023. "Does External Debt Affect Economic Growth: Evidence from South Asian Countries," International Journal of Economics and Financial Issues, International Journal of Economics and Financial Issues, vol. 13(1), pages 83-88, January.
    2. Paul, Uttam Chandra, 2020. "The Causal Relationship between Private Sector Credit Growth and Economic Growth in Bangladesh: Use of Toda-Yamamoto Granger Causality test in VAR Model," MPRA Paper 104476, University Library of Munich, Germany, revised 04 Dec 2020.
    3. Md. Nurul Kabir & Mohammad Dulal Miah & Rubaiya Nadia Huda, 2022. "Determinants Of Credit Risk: A Comparative Analysis Between Islamic And Conventional Banks In Bangladesh," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 67(01), pages 349-379, March.
    4. Andrea F. Presbitero, 2012. "Domestic debt in Low-Income Countries," Economics Bulletin, AccessEcon, vol. 32(2), pages 1099-1112.
    5. Md. Qamruzzaman & Wei Jianguo, 2017. "Financial innovation and economic growth in Bangladesh," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 3(1), pages 1-24, December.
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