This note examines the efficiency gains that might result from market-based debt reduction and alternative uses of … government investment or consumption. Given considerable uncertainty about the efficiency returns of alternative uses of …

performance using different econometric methodologies. This work investigates the effect of debt on production efficiency …-run effect of debt on the production efficiency and, thus, output growth. The results show that, in the short run, as debt … increases by $1 billion, efficiency increases by 0.04%. Additionally, we found that the most indebted countries are the most …