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Record W2992494962

The Debt Index and Its Relation to Economic Activity

2013· article· en· W2992494962 on OpenAlexaboutno aff
John J. Bethune

Bibliographic record

VenueJournal of economics and economic education research · 2013
Typearticle
Languageen
FieldEconomics, Econometrics and Finance
TopicFiscal Policies and Political Economy
Canadian institutionsnot available
Fundersnot available
KeywordsEconomicsIndex (typography)DebtEconometricsInvestment (military)Explanatory powerRegression analysisDebt-to-GDP ratioDeficit spendingExternal debtMacroeconomicsStatisticsMathematics
DOInot available

Abstract

fetched live from OpenAlex

THE DEBT INDEX There are both short run and long run issues involving the problem in the United States and elsewhere. In the short run, the deficit represents a problem for policy makers while in the long term, the national is an issue that must be addressed. To construct a debt I combine the absolute value of the annual federal budget deficit divided by federal government spending with the national divided by nominal GDP. Put simply: Deficit/Spending + Debt/GDP = Debt Index This combines the temporal aspects of our short and long term problems into one measure. The Relation of the Debt Index to Macroeconomic Variables To determine if the index had any meaningful statistical relationship with various macroeconomic variables I generated a series of correlation coefficients comparing the index with these variables on an annual basis since 1980. A major finding was that the index was highly and negatively correlated with private investment as a percent of GDP. The coefficient was -.831 and it was significant at the 99 percent confidence level. It might be expected that other measures of might be highly and/or more so correlated with investment as a percent of GDP so I ran correlations with these as well. The results are in Table I. Table I demonstrates that the relationship of the index to private investment is greater than any individual component of the index. A simple regression was run to suggest the explanatory power of the relationship between the index and investment spending. The results were: Regression Analysis: I/GDP versus Debt Index The regression equation is I/GDP = 23.8 - 6.28 Debt Index Predictor Coef SE Coef T P Constant 23.8483 0.5935 40.18 0.000 Debt Index -6.2818 0.7675 -8.19 0.000 S = 0.979482 R-Sq = 69.1% R-Sq(adj) = 68.0% While this is a fairly simplistic method of determining explanatory power it does show, according to the adjusted R-Square, that the index explains 68 percent of the movement in private investment. To determine how robust this relationship might be I used IMF data, going back to 1980, when possible, to construct a index for 15 major global economies of vary characteristics. The results can be seen in Table II. Accept where noted, all coefficients are significant at the 1 percent level in Table II as well as all of the following tables. This would indicate that the index is highly and negatively correlated with most western-style economies. This would include Sweden, where a large percentage of GDP flows through the public sector. France and New Zealand are the only economies where the relationship does not hold. Another variable exhibiting a significant relationship with the index is the unemployment rate. For the United States, the correlation coefficient is .479 and it is significant at the 1 percent level. This implies that higher levels of short term and long term correspond to higher levels of unemployment. However, in this case the deficit and deficit to government spending ratio are more highly correlated with unemployment than the index, with coefficients of .626 and .824, respectively. In contrast the national and the to GDP ratio are not significantly correlated to the unemployment rate, indicating that unemployment is related much more closely to short run difficulties in the United States. Table III shows the correlation coefficients among the various countries with respect to the index and unemployment. Unlike in the case of the USA, none of the countries that show a significant correlation coefficient have higher coefficients on the relationship with the short term deficit measures. Some, such as Greece, Canada, and Australia, show a more significant correlation with the to GDP ratio. …

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How this classification was reachedexpand

Full frame distilled prediction

Teacher imitation

Not calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.

metaresearch head score (Codex)0.002
metaresearch head score (Gemma)0.000
Version: codex-gemma-dda1882f352aValidation status: machine_predicted_unvalidated
Candidate categoriesInsufficient payload (model declined to judge)
Consensus categoriesnone
DomainCandidate signal: none · Consensus signal: none
Study designCandidate signal: Theoretical or conceptual · Consensus signal: none
GenreCandidate signal: Empirical · Consensus signal: Empirical
Teacher disagreement score0.601
Threshold uncertainty score1.000

Codex and Gemma teacher scores by category

CategoryCodexGemma
Metaresearch0.0020.000
Meta-epidemiology (narrow)0.0000.000
Meta-epidemiology (broad)0.0000.000
Bibliometrics0.0000.000
Science and technology studies0.0000.000
Scholarly communication0.0010.001
Open science0.0000.000
Research integrity0.0000.000
Insufficient payload (model declined to judge)0.0000.001

Machine scores (provisional)

The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.

Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.

Opus teacher head0.061
GPT teacher head0.327
Teacher spread0.266 · how far apart the two teachers sit on this one work
Validation statusscore_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from it

Classification

machine, unvalidated

Machine predicted; a candidate call from one teacher head, not a consensus.

Study designTheoretical or conceptual
Domainnot available
GenreEmpirical

How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".

Quick stats

Citations1
Published2013
Admission routes1
Has abstractyes

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