Abstract:

The liberalization of post-globalization capital movements has created a risk on macroeconomic balance by increasing public debt portfolio’s risk sensitivity. Such a structure that triggers economic and financial instability has encouraged efforts to demonstrate a more professional and effective approach to public debt management. The public debt management activity is the process of developing and implementing strategies designed to meet the public’s financing needs at a low cost and controllable risk level. The presence of debt management policies that are far from the activity and are not placed in a legal framework causes pressure on the public budget, while the increased tendency to debt leads to disruption in macroeconomic balance. From here in the work, the impact of the macroeconomic performance of the performance in public debt management based on the 1995-2017 period for 35 OECD countries was studied by panel data analysis. The results of the empirical analysis have found that the increase in public debt burden has a negative impact on economic growth, increased unemployment, inflation and budget gap. The increase in debt interest payments, which has a positive impact on economic growth, has increased the unemployment rate and the budget gap while creating pressure in the inflation-reducing direction. The study found that the short-term interest rate increase increased inflation and budget gap, negative economic growth and reduced unemployment. Also Dumitrescu-Hurlin (2012) panel Granger causality test results showed the existence of causality relationships between the variables.

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