Macroeconomic Factors and Public Debt: Empirical Evidence from Jordan
Ali Mustafa Al-Qudah

Abstract
This study aims to examine the impact of budget deficit, real GDP growth, unemployment rate and government current expenditure on public debt in Jordan for the period (1992-2017), the study used autoregressive distributive lag (ARDL) approach to examine the study hypotheses. ARDL bound test and co-integration proven that there is a long run relationship exists between budget deficit, real GDP growth, unemployment rate, government current expenditure and public debt in Jordan. The ARDL long run coefficients show that Real GDP growth has a negative and significant impact on public debt while budget deficit and unemployment rate have a positive and significant impact on public debt, but government current expenditure has a positive and not significant impact on public debt in Jordan. In the short run the empirical results show that the first difference of budget deficit and government current expenditure have a positive and significant impact on public debt in Jordan, and the first difference and lag (1) of unemployment has a positive and significant impact on public debt in Jordan. The (CUSUM) stability test shows that the public debt (PD) estimated model is stable.

Full Text: PDF