Paper title: External Debt, Inflation and Growth in Bangladesh: An Empirical Study
Abstract: This study investigates the relationship of external debt, inflation and economic growth in Bangladesh by applying Johansen’s Co-integration test, Vector Error Correction Model (VECM) and Granger Causality using macroeconomic data from 1989 to 2021 in Bangladesh. The growth rate of GDP is used as a proxy for economic growth and external debt stock of the country is used as external debt. Co-integration indicates that there is a long-run relationship between the factors examined in this research and economic growth. Economic growth is impacted by external debt as shown using the Vector Error Correction Model (VECM). However, inflation has been found to be insignificant. Finally, it has been found that long-run causality exists between economic growth and external debt. Keywords: External debt, Economic Growth, Inflation, Cointegration, Vector Error Correction Model (VECM). DOI: https://www.doi.org/10.61607/JFB.V20N1-2.A5 Article Info: Submission Date: March 13, 2023; Acceptance Date: November 12, 2023.
