Author(s)

Médard Mengue Bidzo

Omar Bongo University, Libreville, Gabon.

The multiple attempts at empirical evidence, yet recent, fail to truly dispel the theoretical vagueness of the effects of public debt on economic growth. The aim of this work is to demonstrate that public overindebtedness negatively impacts economic activity in developing countries. From estimation by the generalized moments’ method in the system of the relationship between economic growth and outstanding public debt on data of the Gabonese economy, we get that an increase in the public debt in this country, causes a deceleration of economic activity, thus reflecting a scissor effect between public debt trend and that of economic growth.

Public Debt, Economic Growth, Gabon, GMM

Bidzo, M. (2018) Public Debt and Economic Growth: A Scissor Effect in Developing Countries? The Case of Gabon. Modern Economy, 9, 1672-1686. doi: 10.4236/me.2018.910106.