Supervisors info:
Στέλλα Μιχοπούλου, ΠΔ 407/80, Οικονομικών Επιστημών, Εθνικό και Καποδιστριακό Πανεπιστήμιο Αθηνών
Summary:
Mutation of economic management model of market-based financing basis, the resulting contraction of the real economy and the simultaneous indebtedness, have contributed to the formation of an extremely fragile economic management model.
The purpose of this study is to investigate the relationship between private debt and economic growth (France, Holland, Austria, Germany, Portugal, Spain, Greece, Italy) for the period 2000-2015. Our econometric model is based on the macroeconomic model developed by Stockhammer and Wildauer (2016) plus the variable of private debt
The results showed a positive and statistically significant correlation between private debt and economic growth for France, Austria, the Netherlands and Spain. By contrast, in Greece, Italy, Germany and Portugal, although we would expect a similarly positive association of private debt to GDP growth, however, this variable is considered statistically insignificant. An interpretation of this result is relatively low- although a growing trend in comparison with other concerned countries- volume of private debt, both in Greece ,Italy and Portugal 2000-2006. At the same time shows us that the growing debt is not absorbed by the domestic market, but rather a burden on trade balance through increased imports. It seems that both the Greek and the Italian but also the Portuguese and German economy domestic demand is more 'wage and profit driven' rather than 'debt -driven'.
Keywords:
Financialization, Private Debt, Economic Growth, Europe, South, North