What question did this study set out to answer?

This research aims to investigate how net surplus affects outstanding local debt across various types of local governments in Korea.

Net surplus and outstanding local debt across local government types: evidence from the Republic of Korea

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Examines net surplus and debt relationships in local governments, indicating careful debt policy implications.

This research aims to investigate how net surplus affects outstanding local debt across various types of local governments in Korea.
Analyzed panel data from 243 Korean local governments from 2011 to 2023.
Examined the relationship between net surplus and outstanding local debt.
Focused on differentiating local governments' debt management strategies.
Higher net surplus correlates with lower outstanding debt in metropolitan cities and provinces, cities, and counties.
A 1% increase in net surplus leads to a 0.599% decrease in outstanding debt.
No significant relationship is observed for districts, which typically have little or no debt.

Park et al. (2026) studied this question.

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