Evidencia empírica sobre deuda externa, inversión y crecimiento en México, 1980-2003.

Under some conditions, it is possible for foreign debt to lead to declines in fixed investment within a country. In those cases, economic growth will turn negative. This theoretical possibility is known as the debt overhang hypothesis. This study investigates the debt overhang hypothesis for Mexico during the period between 1980 and 2003. Parameter estimation results offer partial evidence in favor of this hypothesis and simulation results exhibit a high degree of correlation with sample historical data. [ABSTRACT FROM AUTHOR]