Public debt refers to the total amount of money that a government owes to creditors. This debt can arise from borrowing to finance government spending when tax revenues are insufficient. It can be held by domestic or foreign investors, and it often takes the form of bonds or loans. Governments use public debt to fund various projects, such as infrastructure, education, and healthcare. While some level of public debt can be beneficial for economic growth, excessive debt may lead to financial instability and higher interest rates, affecting the overall economy and taxpayers.