Abstract
The purpose of the paper is to explore the broader economic implications of the twin-deficit hypothesis, specifically the crowding-out effect and the deterioration of the domestic manufacturing sector. The hypothesis posits that government borrowing can inhibit private investments and growth. Such a case has been observed empirically in other countries, where high government borrowing suppressed private sector borrowing and investments. Additionally, the paper investigates how sustained deficits can erode the manufacturing sector by increasing reliance on imports, leading to the contraction of local industries and affecting employment and domestic expertise.
Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
