On the heterogeneous link between public debt and economic growth

We use panel data for 115 countries over the period 1995–2016 to model heterogeneity of debt-growth nexus along with underlying factors that might explain it. The grouped fixed effect (GFE) estimator is used endogenously classify into groups and a multinomial logit employed explore drivers detected heterogeneity. GFE classifies five which debt has different impacts on growth. According our results, likelihood strong impact moderated by quality institutions proportion productive expenditure but intensified level indebtedness maturity debt.