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The Effect of Public Debt on Domestic Product and Unemployment (An Empirical Study on the Palestinian Economy)

Khalid Mohammad Hasan Sweis


Tamer Bahjat Hussain Sabri

Khalid Mohammad Hasan Sweis 1 ,

Tamer Bahjat Hussain Sabri 1 
  1. Faculty of Economics & Business , Palestine Technical University- Kadoorie, Tulkarm, Palestine 1

Pages: 133-143

DOI: 10.18488/journal.62/2016.3.10/

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This study sought to recognize the effect of public debt on unemployment and domestic product. Also, it aimed to identify the developments that occurred in some indices in the Palestinian economy. To achieve the goals of this study, the researchers employed the data covering the period (1999-2014) as well as the simple regression analysis. The findings showed that the percentage of public debt to gross domestic product amounted, on average, by 20%. Furthermore, it was found that there is a connection of statistical effect between the rate of public debt and the independent variable, rate of debt, to gross domestic product. Meanwhile, the findings showed no connection between the rate of public debt and gross domestic product.

Contribution/ Originality
Very few studies sought to tackle the topic of this study, or at least this topic was not dealt with from all angles. This paper is an addition to existing literature as it contributes to recognize the effect of public debt on  unemployment and domestic product. Furthermore, this study is among very few studies that use regression analysis in the period between (1999) and (2014) to highlight the aforementioned relationship.


Public debt, Domestic product, Unemployment, Empirical study, Development, Palestinian.



  1. Abu Al-qumssan, K., 2005. Analytical study of the status of the Palestinian economy, between opportunities of investment and future challenges. The First Scientific Conference on Investment and Funding in Palestine, Faculty of Business, The Islamic University, Gaza, Palestine.
  2. AL- Saraireh, 2014. The relationship between unemployment rate in Jordan with rates of foreign labour force, Government expenditure, and economic growth. International Journal of Business and Social Science, 5(3): 294-300.
  3. Al-Adayla, 2015. The Hierarchy of public debt in Jordan and it effect on economic growth (1980-2012). Administrative Sciences Studies Journal, 42(2): 1-25.
  4. Al-Mazrue, A. and A. Jajma, 2012. The effect of government expenditure on gross domestic product. Journal of Damascus University  for Economic Sciences and law, Damascus, Arab Republic of  Syria, 28(1): 611-650.
  5. Apere, 2014. The impact of public debt on private investment in Nigeria: Evidence from a nonlinear model. International Journal of Research in Social Sciences, 4(2): 130-138.
  6. Central Palestinian Bureau of Statistics, 2010. Annual Economic Report, Ramallah, Palestine.
  7. CPBS, 2015. Annual Economic Report, Ramallah, Palestine.
  8. Fedeli and Forte, 2012. Public debt and unemployment growth: The need of new fiscal-monetary rules. Evidence from OECD countries. Economic Politica, 29(3): 409-437.
  9. Ibrahim, H. and M. Khair, 2013. The effect of monetary and funding policy on the macroeconomic indices in Sudan (1980-2010). Journal of Economic Sciences, 14(2): 117-133.
  10. Rajab, M., 2011. The effect of spending policy on inflation in Palestine, MA Thesis Supervised by Dr. Mueen Rajab, Faculty of Economics and Administrative Sciences, Al-Azhar University, Gaza, Palestine.
  11. Spilioti, 2015. The relationship between the government debt and GDP growth: Evidence of the Euro area countries. Investment Management and Financial Innovations, 12(1): 174-178.
  12. Suruji, F. and J. Ghazawni, 2009. Food aids and Macro economic indices in Palestine. Palestine: Palestine Institute of Economic Policies.
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This study received no specific financial support.

Competing Interests:

The authors declare that they have no competing interests.


All authors contributed equally to the conception and design of the study.

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