المستخلص: |
This paper seeks to empirically explore the relationship between public debts, financial system stability and economic growth in Algeria during the period 2000- 2021. In particular, it addresses the question of what kind of influence public debts, the banking sector and the financial system has on economic growth in Algeria. The proposed approach is Vector Autoregressive (VAR) modeling, which allows, with the introduction of a minimal number of restrictions, to identify some structural shocks and to derive their effects on aggregate variables. The results show that the link between economic growth and public debt is twofold: in the short term, an increase in debt supports domestic demand and growth. The debt and deleveraging cycles are therefore correlated with the economic cycle. Moreover, the impact of the stability of the financial system on economic growth is significant. It facilitates the exchange of goods and services.
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