PUBLIC DEBT AND ECONOMIC GROWTH: A COMPARATIVE ANALYSIS OF DEVELOPED AND DEVELOPING COUNTRIES

Public debt is an important instrument of fiscal policy and can significantly influence economic growth. Government borrowing may support economic activity by financing public investment and stimulating demand, but excessive debt can increase debt-servicing costs, reduce fiscal space, and constrain private investment. This article examines the relationship between public debt and economic growth by comparing developed and developing countries. It focuses on the main channels through which public debt affects economic performance and considers the importance of debt levels, institutional quality, financing conditions, and the use of borrowed resources.