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Debt and economic growth in CEMAC: An empirical threshold model analysis

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  • Kuikeu, Oscar

Abstract

Since the beginning of year 2026 some of CEMAC countries even those considered as the most prosperous like Cameroon use the external debt extensively until to finance the public expenditures as the country’s national budget. Considering the current debate on debt dynamics into the area this paper aims investigating the relationship between debt and economic growth. Once more in investigating this relationship the literature in general fails to design a parcimonious model where most of the parameters are significant. Then to overcome this gap we use here a statiscal model limited to financial series. From an empirical side, we use a nonlinear short-run adjustment of a STR (Smooth Transition Regression) form for the CEMAC zone as a whole between 2004-2025. According to our results, we support the Old literature of a positive association between public debt and growth. Then the CEMAC zone as a whole is a supportive case where the Keynesian view of the economy holds as this have been advocated in earlier developments on the same area. The main Recommendation of this study is that his members States should avoid the use of external debt as this has been done considerably into the area since the beginning of this year.

Suggested Citation

  • Kuikeu, Oscar, 2026. "Debt and economic growth in CEMAC: An empirical threshold model analysis," EconStor Preprints 344074, ZBW - Leibniz Information Centre for Economics.
    • Handle: RePEc:zbw:esprep:344074
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    References listed on IDEAS

    as
    1. Henning Bohn, 1998. "The Behavior of U. S. Public Debt and Deficits," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(3), pages 949-963.
    2. Z. Lomnicki, 1961. "Tests for departure from normality in the case of linear stochastic processes," Metrika: International Journal for Theoretical and Applied Statistics, Springer, vol. 4(1), pages 37-62, December.
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    Keywords

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    JEL classification:

    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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