Public Debt, Investment, and Growth: The DIG and DIGNAR Models

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Public Debt, Investment, and Growth: The DIG and DIGNAR Models (DIGx)

This online course, presented by the Institute for Capacity Development and the Research Department, explains how to analyze the relation between public investment, growth, and public debt dynamics using two dynamic structural models: the Debt, Investment, and Growth (DIG) model and the Debt, Investment, Growth and Natural Resources (DIGNAR) model. The course presents and discusses the key pieces of these models (the investment-growth nexus, the fiscal adjustment, and the private sector response) and their interactions, which helps learners understand and assess the macroeconomic effects of public investment scaling-up plans, including on growth and debt dynamics. It elaborates on important factors that may shape these effects such as the type of fiscal financing, the rate of return of ...

Target Audience

All government officials are welcome to register. This course is particularly useful for officials from ministries of finance, debt agencies, central banks, and other government agencies responsible for providing advice or implementing macroeconomic and debt policies.

Qualifications

Some knowledge of economics is helpful. Basic Microsoft Excel skills and access to a computer with a reliable internet connection and a Google Chrome web browser are essential.

Course Objectives

Upon completion of this course, participants should be able to:

Understand the basics of dynamic macroeconomic models for analyzing public investment scale-ups, growth, and debt dynamics.
Understand the key elements of the DIG and the DIGNAR models.
Understand how these models are used to analyze how the macroeconomic effects of public investment surges depend on policy responses, the type of financing of these surges (e.g., taxes and domestic versus external financing), and structural factors (e.g., the efficiency of public investment).
Interpret the output of policy scenario analyses using the DIG and DIGNAR models, as reflected in official IMF documents such as Article IV reports.

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