Proceedings of 5th Annual American Business Research Conference
6 - 7 June, 2013, Sheraton LaGuardia East Hotel, NY, USA, ISBN: 978-1-922069-24-5
The Relevance of 60% Debt to GDP Maastricht’s Rule:
Evidence from Balkan Countries
Agim Kukeli1
The relegation of financial crises and economic great recession to
debts crises, the one seen in Euro zone and beyond has spurred
discussions among economists, policymakers, and practitioners on
the optimum level of government debt. Is there an optimum level of
debt that a country must follow? What is the relevance of 60% debt
to GDP Maastricht’s Rule? Debt crises has made even those who
designed 3/60 rule (3 % deficit/GDP and 60% debt to GDP ceiling
levels enacted by Maastricht Treaty) to rethink many issues from
institutional ones to economic prerogatives. Countries aspiring to
join EU, like Balkan countries, are considered in this study, which
focuses on the role of debt to growth. The econometric results are
contrasted with Maastricht rule (baseline model). Data are taken
from WDI (World Bank) and Eurostat.
Key Words: Public Debt, Growth, Fiscal Rule, Maastricht Treaty
JEL Category: E 60, E 62, H 60, H 63
1
Agim Kukeli, Professor of Economics, Department of Economics and Finance, School of Economics,
University of New York Tirana, Albania. E-mail: akukeli@unyt.edu.al