Debt dependency, debt relief, and macroeconomic policies: how does the structure of external and domestic debt affect the well being of a country?s citizenry?

by Burns, Jackie Rene

Abstract (Summary)
The research expands the scope of the World System and Dependency theories that

emphasize the deleterious effects of the extent of external debt held by multilateral

institutions (Chase-Dunn, 1975; Sell and Kunitz, 1986-87; Meldrum, 1987; Harsch,

1989; Bradshaw and Huang, 1991; Bradshaw et al., 1993) and the structure of capital

formation (Chase-Dunn 1975;Bornschier, Chase-Dunn, and Rubinson 1978; Bornschier

and Chase-Dunn,1985; Timberlake and Kentor, 1983; Bradshaw, 1987; Walton and

Ragin, 1990; Dixon and Boswell, 1996; Firebaugh, 1996) on the growth and

development of Third World Countries. This research primarily examines the

relationship between external debt held by multilateral development institutions and

central government debt. A major barrier to social and economic development in

developing countries is malnutrition and the inability of individuals to maintain a healthy

standard of living and be economically and socially productive. The major findings on

the direct and indirect effect of external debt and the solvency of a domestic economy on

the health and nutritional status of women and children were: External debt as measured

as a percent of GDP did produce slight but statistically significant direct effects on

under-five infant mortality. Central government debt as measured as a percent of GDP

demonstrated a direct effect only with under-five mortality and it was modest at best.

Gross domestic investment measured as a percent of GDP also exhibited a weak direct

effect on under-five infant mortality and percent total immunized. As expected, external

debt did demonstrate a substantial and statistically significant direct effect on central

government debt. The results of the path analysis reveal that external debt consistently

produced an indirect effect, operating through central government debt, on measures of

under-five mortality, percent children immunized, and children wasting and stunting.

However, the magnitude fluctuates considerably and their statistical significance drops

to below acceptable levels on childhood immunizations and the nutritional measures.

Bibliographical Information:

Advisor:McIntosh, William Alex; Albrecht, Don E.; Murguia, Edward; Saenz, Rogelio

School:Texas A&M University

School Location:USA - Texas

Source Type:Master's Thesis

Keywords:globalization of capital


Date of Publication:12/01/2004

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