The Impact of Inflation Targeting on Public Debt: An Evidence from Propensity Score Matching Approach

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Atıf İçin Kopyala

Nana A. B. I., BAYCAN İ. O.

ESKISEHIR OSMANGAZI UNIVERSITESI IIBF DERGISI-ESKISEHIR OSMANGAZI UNIVERSITY JOURNAL OF ECONOMICS AND ADMINISTRATIVE SCIENCES, cilt.17, sa.2, ss.479-501, 2022 (ESCI)

• Yayın Türü: Makale / Tam Makale
• Cilt numarası: 17 Sayı: 2
• Basım Tarihi: 2022
• Doi Numarası: 10.17153/oguiibf.1076534
• Dergi Adı: ESKISEHIR OSMANGAZI UNIVERSITESI IIBF DERGISI-ESKISEHIR OSMANGAZI UNIVERSITY JOURNAL OF ECONOMICS AND ADMINISTRATIVE SCIENCES
• Derginin Tarandığı İndeksler: Emerging Sources Citation Index (ESCI)
• Sayfa Sayıları: ss.479-501
• Anahtar Kelimeler: Propensity Score Matching, Inflation Targeting, Public Debt, DIFFERENCE
• Anadolu Üniversitesi Adresli: Evet

Özet

This study uses the Propensity Score Matching (PSM) approach to examine the impact of adopting the Inflation Targeting (IT) policy on internal and external public debt both for the groups of advanced and developing economies. We investigate the matching results to estimate the Average Treatment Effect (ATE) and Average Treatment Effect on the Treated (ATT) by employing different matching methods of nearest-neighbor, radius, stratification, and kernel matching. Our results are robust and statistically significantly reveal that adopting the IT policy reduces external public debt both for developed and developing economies. Moreover, on average, the adoption of IT policy leads to a statistically significant reduction of internal public debt for developing economies.