The national debt almost tripled during during the reagan administration, slowed considerably during clintons time in office and rose more gradually during the administrations of gw bush. For developing and emerging economies, 40% is the suggested debttogdp ratio that should not be breached on a longterm basis. Technology family projects business global events books fiction newsletters. Learn about debttogdp ratio by country the balance. The table has current values for government debt to gdp, previous releases, historical highs and record lows. The starting date of a raising declining debt episode is the first year in which the debttogdp ratio exceeds x percent, conditional on the ratio being below above x percent in the previous year. That means the average family owed as much on their mortgages, auto loans, and credit cards as.
This page provides italy government debt to gdp actual values, historical data, forecast, chart, statistics. The debttogdp ratio is an equation with a countrys gross debt in the numerator and its gross domestic product gdp in the denominator. France recorded a government debt equivalent to 98. A combination of recessions, defense budget growth, and tax cuts has raised the national debttogdp ratio to unsustainable levels. The real danger posed by debt is once debt becomes a significant fraction of gdp, and its growth rate substantially exceeds that of gdp, the economy will suffer a recession even if the debt to gdp ratio merely stabilizes. A low debttogdp ratios indicates an economy that produces a large number of goods and services and probably profits that are high enough to pay back the debt.
Governments aim for low debt to gdp ratio s and can standup to the risks involved by increasing debt as their economies have a higher gdp and profit margin. Republican presidents after eisenhower have increased the federal debt as a percentage of gross domestic product by a total of 60%. He expects ratios of public debt to gross domestic product to jump by 10 to 20 percentage points. Background steve keen is associate professor at the university of western sydney in australia and founder of the center for economic stability, which evolved from his blog debtwatch.
That means the average family owed as much on their mortgages, auto loans, and credit cards as they earn in a year. Government debt to gdp in france is expected to be 98. Total public debt as percent of gross domestic product. Private debt to gdp in france is expected to be 245. The us has fallen from the 6th most indebted nation in terms of debttogdp in 2014 to 11th in 2015. Historically, greece governments debt to gdp ratio was already at a relatively high level across europe mcauley, 2011graph 1. In the longterm, the france private debt to gdp is projected to trend around 236. The statistic shows australias public debt from 2014 to 2018 in relation to the gross domestic product gdp, with projections up until 2024. President obama is the only democratic president during whose time in office the debt has risen relative to gdp. General government debttogdp ratio measures the gross debt of the general government as a percentage of gdp. Notice this is not research from some fringe economics, it comes from the heart of the international monetary system and sponsored by the central banks. A high debt to gdp ratio isnt necessarily bad, as long as the countrys economy is growing. If the private sector is deleveraging cutting back on spending and investment to pay down debt, it is important that the government take the slack.
Furthermore, using linear regression an analysis will be conducted between public debt to gdp ratio and the unemployment rate for the 5 countries that have the highest public debt to gdp ratio of the selected sample. Debt to gdp ratio historical chart interactive chart of historical data comparing the level of gross domestic product gdp with federal debt. Debt to gdp ratio is one of the indicators of the health of an economy. It amuses and distresses me that people are starting to worry about the u. The debttogdp ratio is the ratio of a countrys public debt to its gross domestic product gdp. The united states has continuously had a fluctuating public debt since then, except for about a year during 18351836. The household debt to gdp ratio reached 100% in 2007. The debttogdp ratio hit its alltime record of 1% by wars end. Data for these countries are included in their parent nations prior to these dates. First quarter of 2017 compared with fourth quarter of 2016. G20 advanced countries included are australia, canada, france, germany, italy, the u. The debttogdp ratio gives insight into whether the united states has the ability to cover all of its debt. Correcting these basic computational errors undermined the central claim of the book that too much debt causes. A history of world debt how public debt has changed since 1880 t he global financial crisis has taken its toll on the world economy, especially on the public finances of advanced economies.
The current level of the debt to gdp ratio as of december 2019 is 106. Net debt figure is the cumulative total of all government borrowings less repayments that are denominated in a countrys home currency. France government debt to gdp 19802019 data historical. The figure below shows average increases in the debttogdp ratio for the past 10 years. In economics, the debttogdp ratio is the ratio between a countrys government debt and its. It is the amount of national debt of a country as a percentage of its gross domestic product gdp. At the end of the 4th quarter of 2019, united states public debt to gdp ratio was at 106.
At the end of the 4th quarter of 2019, united states public debttogdp ratio was at 106. The relationship of the debtgdp ratio and economic growth. What share of government world debt does each country owe. For developing and emerging economies, 40% is the suggested debt to gdp ratio that should not be breached on a longterm basis. The debt to gdp ratio does this by dividing a nations debt by its gross domestic product. In the two years containing the 200709 recession, the debt to gdp ratio grew by about 16 percentage points. National debt by year compared to gdp and major events. Total us debt has actually fallen from 2008 a marked contrast to the previous two decades. It implies that crossing this limit will threaten fiscal sustainability. Apr 17, 2012 the debt gdp ratio is one of the most over used and partially useless summary statistics ever generated. In a few instances, missing data prevent us from identifying the exact year in which the debt to gdp ratio crossed the x percent threshold. By associate professor steve keen, university of western sydney. Furthermore, using linear regression an analysis will be conducted between public debttogdp ratio and the unemployment rate for the 5 countries that have the highest public debttogdp ratio of the selected sample. These are lists of countries by public debt, based on data from the cias world factbook and the imf.
Governments aim for low debttogdp ratios and can standup to the risks involved by increasing debt as their economies have a higher gdp and profit margin. The history of sovereign debt evolved over time along with the purposes for which. Nov 18, 2017 total us debt has actually fallen from 2008 a marked contrast to the previous two decades. It is a key indicator for the sustainability of government finance. The yaxis shows the total percentage growth in national debt and the xaxis shows the time in office in months. The united states federal government has continuously had a fluctuating public debt since its formation in 1789, except for about a year during 18351836, a period in which the nation, during the presidency of andrew jackson, completely paid the national debt. The evolution depends on the interest rate, \r\, the growth rate of gdp, \g\, and the primary deficit \gt\.
Historical debt, public debt, gross debt, debttogdp, debt database. The debtgdp ratio is one of the most over used and partially useless summary statistics ever generated. S treasurer, michael hillegas, after its formation in 1789. The us fell down the rankings not because it paid off its debts, but because other countries have taken on more debt. By comparing what a country owes to what it produces, the debttogdp ratio. External debt as percentage of gross domestic product gdp is the ratio between the debt a country owes to nonresident creditors and its nominal gdp. A ratio that expresses the national debt of a country with relation to its gross domestic product, or gdp, that also helps in indicating whether or not that country has the ability to repay that debt. Although many periods when debttogdp ratios rose explosively. Is debttogdp ratio a valuable fiscal anchor for the. Interactive chart illustrating the growth in national public debt by u. By the second quarter of 2009, this ratio equaled 50 percent. A debttogdp ratio of 60% is quite often noted as a prudential limit for developed countries. Measuring both deficits and debt as a proportion of gdp is a.
A high debttogdp ratio isnt necessarily bad, as long as the countrys economy is growing. Apr 21, 2020 the statistic shows australias public debt from 2014 to 2018 in relation to the gross domestic product gdp, with projections up until 2024. In a few instances, missing data prevent us from identifying the exact year in which the debttogdp ratio crossed the x percent threshold. The national debt by year should be compared to the size of the economy as measured by the gross domestic product. Based on these figures, an april 2010 report by the imfs. Lebanon has the next highest debttogdp ratio at 152%, followed by italy at 123. To calculate its debttogdp ratio, you would divide the amount of its debt by its gdp. Democratic presidents have reduced the debt as a percentage of gdp by a total of 9%. The national debt almost tripled during during the reagan administration, slowed considerably during clintons time in office and rose more gradually during the administrations. The debttogdp ratio is accounting and is informative, but not public policy. Debttogdp ratio dropped below 100% in 1948 90% and continued a relatively slow decline to reach the midtolow 30% range in the mid1960s.
Total public debt as percent of gross domestic product gfdegdq188s was first constructed by the federal reserve bank of st. Percent of gdp, annual, not seasonally adjusted 1929 to 2019 5 days ago percent of gdp, annual, not seasonally adjusted 1930. The national debt dilemma council on foreign relations. And what has thrived in this zero and negativeinterestrate nirvana is debt, with the householddebttogdp ratio soaring over the years to 127. For developing and emerging economies, 40 per cent is the suggested public debttogdp ratio. History of the united states public debt wikipedia. To allow comparisons over the years, public debt is often. The next highest ratio is from greece, which at 181. To allow comparisons over the years, public debt is often expressed as a ratio to gross domestic product gdp. This page displays a table with actual values, consensus figures, forecasts, statistics and historical data charts for country list government debt to gdp.
In the two years containing the 200709 recession, the debttogdp ratio grew by about 16 percentage points. As of june 2019, the nation with the highest debttogdp ratio is japan with a ratio of 253 %. Top 10 countries having the highest household debt to gdp. This isnt necessarily great news for the us, because its debttogdp ratio has actually increased to 103% from 101. The debt to gdp ratio is the ratio of a countrys public debt to its gross domestic product gdp. Oct 25, 2019 the debt to gdp ratio is an equation with a countrys gross debt in the numerator and its gross domestic product gdp in the denominator.
As a share of gdp public debt has grown sharply in recent yearsfrom 70 percent in 2000 to close to 100 percent in 2009. Steve is an expert in the unconventional economic theory called the financial instability hypothesis, which was developed by the. Consequently, the smaller the ratio between the debt foreign and domestic combined and the gross domestic product, the better. The fact that historical rates are at all time highs in many countries and it is an easy statistic fo. So is information contained in data on budget balances. A public debttogdp ratio of 60 per cent has been proposed as a prudent limit for developed countries. We find that the correlation between government debttogdp ratios and future growth in reinhart and rogoffs 2010a and and 2010b dataset results from outliers which come from the country most suggestive of the hypothesis that slow growth causes high levels of.
You can use the debttogdp ratio to compare the national debt to other countries. The approximate household debt in south korea was 1. Historical patterns of public debt international monetary fund. Nov 09, 2010 a debt to gdp ratio of 60% is quite often noted as a prudential limit for developed countries. Australia public debt in relation to gross domestic product. Federal debt held by the public as a percentage of gross domestic product, from 1790 to 20, projected to 2038. In the longterm, the france government debt to gdp is projected to trend around 97. General government general government debt oecd data. If the government is committed to not letting the debt to gdp ratio rise, what is the largest primary deficit as a percent of gdp it can run. Australia public debt in relation to gross domestic. Debttogdp ratio is one of the indicators of the health of an economy. Investors worry about a country defaulting on its debt when the debt to gdp ratio reaches above 77 percent. Number 7 in the list is south korea with 90% of household debt to gdp ratio. Public debt through the ages vox, cepr policy portal voxeu.
Central government debt, total % of gdp international monetary fund, government finance statistics yearbook and data files, and world bank and oecd gdp estimates. France government debt to gdp 19802019 data 20202022. Foreign debts are generally viewed as more dangerous than their domestic opponent. A combination of recessions, defense budget growth, and tax cuts has raised the national debt to gdp ratio to unsustainable levels. The history of the united states public debt started with federal government debt incurred during the american revolutionary war by the first u.
Relevance of public debttogdp ratio correlation with. The united states cannot afford to default on its debt without major global economic consequences. What level of government debt to gdp ratio is sustainable. Apr 29, 2020 the debt to gdp ratio gives insight into whether the united states has the ability to cover all of its debt. General government debt to gdp ratio measures the gross debt of the general government as a percentage of gdp. A historical public debt database international monetary fund. Italy government debt to gdp 19882019 data 20202022. The starting date of a raising declining debt episode is the first year in which the debt to gdp ratio exceeds x percent, conditional on the ratio being below above x percent in the previous year. This equation characterizes the evolution of the debttogdp ratio. By comparing what a country owes to what it produces, the debt to gdp ratio. Our interactive overview of government debt across the planet. This page provides values for government debt to gdp reported in several countries part of europe.
The higher the interest rate, the more resources the government must devote toward compensating its creditors, hence the larger will be next periods value of \\fracby\. Aug 04, 2016 thats why economists came up with the debttogdp ratio as an indicator of how well a certain countrys economy is doing. Total public debt gfdebtn and gross domestic product, 1 decimal gdp. A low debt to gdp ratio s indicates an economy that produces a large number of goods and services and probably profits that are high enough to pay back the debt. This page provides italy government debt to gdp actual values, historical data, forecast.
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