This study examines how public debt is associated with GDP in Vietnam over the period 2000–2024, with particular attention to whether this relationship varies across different debt states, economic conditions and macroeconomic environments.
We employ three innovative techniques, including using the Quantile-on-Quantile Regression (QQR), Multivariate Quantile-on-Quantile Regression (MQQR) and Quantile-on-Quantile Granger Causality (QQGC) methods.
The results indicate that the impact of debt on growth is highly heterogeneous across distribution. The MQQR estimates illustrate the role of structural moderators. Financial development (FD), labour force and trade openness strengthen the growth-enhancing effects of debt, while inflation magnifies its negative influence by undermining macroeconomic stability. In addition, the QQGC analysis further clarifies causal directions between variables.
The research formulates Sustainable Development Goals-oriented policies based on these results, enhancing debt sustainability, inclusive growth, FD and macroeconomic stability as important pillars for the long-term development strategy in Vietnam.
This study contributes to the debt–growth literature by showing that the effectiveness of public debt depends not only on its level, but also on the surrounding macroeconomic and structural environment. By providing distribution-sensitive evidence from Vietnam, the paper extends existing work beyond average and threshold-based interpretations of debt sustainability.
