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Are Government Bonds Net Wealth? Some Empirical Evidence

DOI: 10.4236/me.2011.23045, PP. 412-415

Keywords: Public Debt, Economic Growth, Ricardian Equivalence

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Abstract:

This paper aims to investigate the impact of government debt on economic growth for a balanced panel of G7 countries over the period 1990-2008. We found empirical evidence that Ricardian Equivalence does not holds in general. The analysis indicates that only Germany shows a negative association between public debt and economic growth. The US and France show Ricardian equivalence and UK, Japan, Italy and Canada show a positive association.

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