ANALYSIS OF PUBLIC DEBT AT SUBNATIONAL GOVERNMENT LEVELS: EVIDENCE FROM CANTONS IN THE FEDERATION OF BOSNIA AND HERZEGOVINA

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Jasmin Halebić Amina Moćević

Abstract

Total public debt of ten cantons in the Federation of Bosnia and Herzegovina (FBiH), one of the two entities in BiH, have substantially increased in recent years. Since it is relatively small in nominal terms, this galloping trend have not attracted enough attention of decision makers. If these developments continue in the future, the public debt at cantonal level in FBiH might create serious fiscal problems and become one of central issues for policy makers. This has motivated our investigation of determinants that caused the increase in public debt over the period 2012-2018.
We apply a panel regression analysis and investigate how budget deficit, trade balance, unemployment rate, size of population and institutional changes affect public debt. We find that public debt is positively associated with budget deficit but negatively associated with trade balance, the size of population and institutional changes. These findings motivated policy recommendations presented in the paper.

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How to Cite
Halebić, J., & Moćević, A. (2020). ANALYSIS OF PUBLIC DEBT AT SUBNATIONAL GOVERNMENT LEVELS: EVIDENCE FROM CANTONS IN THE FEDERATION OF BOSNIA AND HERZEGOVINA. The South East European Journal of Economics and Business, 15(2), 109-123. Retrieved from http://journal.efsa.unsa.ba/index.php/see/article/view/1279
Section
Scientific and Professional papers: Economics and Business
Author Biographies

Jasmin Halebić, Associate professor, Faculty of Economics, University of Zenica

Jasmin Halebić, PhD (corresponding author)
Associate professor
Faculty of Economics
University of Zenica
E-mail: jasmin.halebic@ef.unze.ba
Address: Ekonomski fakultet,
Fakultetska br. 3, 72 000 Zenica

Amina Moćević, Ministry of Finance, Canton Sarajevo

Amina Moćević, PhD student
Ministry of Finance
Canton Sarajevo
E-mail: amina.mocevic@mf.ks.gov.ba