Samir Abdelhafidh
Savings and Development Vol. 35(2011), No. 1, pp. 29-53

This paper investigates the causality links among domestic saving, external debt inflows, and economic growth in Tunisia over the period 1970-2008. The Autoregressive Distributed Lag (ARDL) approach proves cointegration relationships between the variables of interest and justifies the use of a Vector Error Correction framework to make Granger causality tests. In the short-run, we find bi-directional causality between private debt inflows and saving, and oneway causalities running from these inflows to growth and from the latter to saving. In the long-run, saving and growth Granger-cause private debt inflows, whereas public debt inflows Granger-cause saving. These results suggest some economic policies for Tunisia.

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