@article{ali2013external,
  title = {External Debt and Financing of Economic Development: Evidence from North African Countries},
  author = {Tarek Ben Ali and Tarek Sadraoui  },
  year = 2013,
  url = {https://ibimapublishing.com/articles/JNARB/2013/335933/},
  journal = {Journal of North African Research in Business},
  volume = 2013 (2013),
  pages = 20,
  doi = 10.5171/2013.335933,
  abstract = {Considering the economies of North Africa, the purpose of this research is to study the role of external debt in the financing of economic development. In particular, this paper examines the relationship between external debt and economic growth in North African economies. In fact, in recent years the south of the Mediterranean knows significant changes dictated mainly by the crisis of European sovereign debt and the large social manifestations in some Arabic countries. Foremost among these challenges is the issue of external debt and its role in financing economic development. The study was modelled on Patillo and al., (2002) and uses the technical panel. Combining the leading ratios of external debt and the main determinants of economic growth, we have verified the existence of an optimal threshold beyond which the external debt slows economic growth (there is a curve Laffer debt). For the North African countries, the empirical study shows that the external debt is not an obstacle to development when it contained within reasonable limits. Contrary, it can help these countries to strengthen their growth. However, an increase in debt service has a negative impact on economic growth and the transmission channel of this impact depends on the quality of the investment and the debt burden.Overall, the generated results suggest a nonlinear relationship between debt and growth: there is a critical threshold that would make a negative economic growth. This threshold, which corresponds to the marginal impact of debt on growth, reached 47% of GDP. The question remains whether public debt is indeed associated with higher growth below this turning point.},
  keywords = {financing of economic development, external debt, economic growth, North African economies, Panel data.},
  note = Article ID: 335933
}