Analyzing variables in OECD countries to determine an accurate maximum level of U.S. debt.

This research project intends to estimate a range of numbers that could accurately represent the maximum debt the US can take on before a default. My research is based on a paper by the American Enterprise Institute and written by Mark J. Warshawsky and Giorgi Bokhua that came out in September 2024. The paper is titled “Current Estimates of Sustainable Government Debt Limits for the US and 26 Other OECD Countries”. My goal has been to recreate their exact model and eventually change some variables to possibly determine the model’s accuracy and learn more from the overall study. So far, I have collected all the necessary data to recreate Warshawsky and Bokhua’s model. With Dr. Landgraf’s help, I have run a regression with results that are like theirs but with minor differences. For instance, where their regression results are positive, so are mine. My results are also statistically significant where theirs are. Most of my regression result numbers are in the same ballpark as theirs. The next step in this research process is to tweak minor flaws in my regression and fill in missing data. Dr. Landgraf believes that our results can only become closer to those in the AEI study as we make minor tweaks to the regression. The end goal of this project is to provide some insight into the maximum amount of debt the US can take on. A US debt default would have catastrophic consequences for the US and the world. I hope this paper persuades policymakers to avoid a future debt default at all costs. 

Harrison Williams '25

Mentor: Dr. Steve Landgraf, Economics and Business
Major: Economics and Business
Hometown: Norfolk, Virginia