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Spatial Spillover Effects of Debt Relief from the Heavily Indebted Poor Countries (HIPC) Initiative

Author

Listed:
  • Joshua C. Hall

    (West Virginia University, Department of Economics)

  • Serkan Karadas

    (Sewanee, The University of the South, Department of Economics)

  • Minh Tam T. Schlosky

    (Sewanee, The University of the South, Department of Economics)

Abstract

The impacts of various economic and institutional factors transcend the borders of a nation and flow over to adjacent countries. Past research has found that there are spatial spillovers in economic growth, development of institutions, governance quality and institutional quality. This paper conducts a study on the direct and indirect effects of debt relief from the Heavily Indebted Poor Country (HIPC) Initiative and the Multilateral Debt Relief Initiative (MDRI) programs. The IMF and the World Bank provide debt relief to the member countries that have passed the Decision Point of the HIPC Process. Using the Spatial Durbin Model (SDM) model, this study shows that there are negative spatial spillovers of the impacts of being a HIPC member on neighboring countries.

Suggested Citation

  • Joshua C. Hall & Serkan Karadas & Minh Tam T. Schlosky, 2016. "Spatial Spillover Effects of Debt Relief from the Heavily Indebted Poor Countries (HIPC) Initiative," Working Papers 16-23, Department of Economics, West Virginia University.
    • Handle: RePEc:wvu:wpaper:16-23
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    File URL: http://busecon.wvu.edu/phd_economics/pdf/16-23.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    foreign aid; debt relief; HIPC; spatial spillovers; SDM model; SLX model;
    All these keywords.

    JEL classification:

    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models

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