Social Science and Human Research Bulletin

This paper examines the relationship between GDP, Exports, and Debt of America from 1970 to 2021. It is worth investigating whether the marginal decline or increase in GDP and exports impacts the debt. The methodology consists of ARDL bounds cointegration of short-run relationship and found a negative relationship between debt and exports and a positive relationship between GDP and Debt, while Toda-Yamamoto Causality found unidirectional causality that runs from exports to Debt, exports to GDP, and debt to GDP.  This study provides practical contributions to assist decision-makers in formulating fiscal policies to bring the debt to a sustainable level.

GDP implosion, debt-to-GDP ratio, Toda Yamamoto causality, Autoregressive distributed Lag cointegration test.

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