Does public debt help to drive Uganda’s economic growth? Insights from application of NARDL analysis

Abstract

This study investigates the relationship between public debt and economic growth in Uganda for the period 1990 to 2023 using a nonlinear autoregressive distributed lag (NARDL) model. The analysis finds that public debt, measured as both total debt and debt-to-GDP ratio, has a significant and detrimental nonlinear effect on Uganda’s economic growth in both the short and long run. The study concludes that Uganda should prioritize domestic revenue mobilization over further debt acquisition to foster sustainable economic growth.