Department of Economics and Finance

Permanent URI for this collectionhttp://localhost:4000/handle/123456789/1929

Browse

Now showing 1 - 9 of 9

Do Institutional Quality and Trade Openness Influence Economic Growth? An Empirical Evidence from India
(Springer, 2022-03) Giri, Arun Kumar; Mohapatra, Geetilaxmi
The study empirically examines the impact of trade openness and institutional quality on economic growth in India for the period 1990–2019. The study uses export plus imports as a ratio of GDP and composite governance indicators to measure trade openness and institutional quality, respectively. GDP per capita is used as the proxy for economic growth along with financial development, domestic capital, exchange rate, and inflation as other conventional determinants of economic growth. Autoregressive distributed lag (ARDL) co-integration approach along with the first-generation unit root tests is used in the present study to test empirical relationships. The results reveal that both trade openness and institutional quality exert a significant and positive impact on economic growth in both the long and short runs. Further, the interaction of trade openness and institutional quality is shown to have a significant impact on economic growth as well. The estimates also confirm that domestic capital and financial development have a significant positive influence on the economic growth of the country. The results further indicate that the exchange rate has a significant negative impact on economic growth in both long run and short run.
Does Technological Progress, Trade, or Financial Globalization Stimulate Income Inequality in India?
(Korea Science, 2021) Giri, Arun Kumar; Pandey, Ranjan; Mohapatra, Geetilaxmi
The main purpose of the present research is to analyze the effects of trade, financial globalization, and technological progress on income inequality in the Indian economy over the period from 1982 to 2018. For this purpose, the study uses economic growth, financial globalization, trade openness, technological development, and economic inequality variables with appropriate proxies. The study employs the Auto Regressive Distributed Lag (ARDL) approach to co-integration and VECM based Granger causality approach to estimate both the short-run and long-run relationship and causality among variables. Using the ARDL bounds test, the study finds a long-run co-integrating relationship existing among the variables in the model. The study confirms the existence of a positive and significant impact of technological progress on income inequality. Further, globalization's limited impact reflects two offsetting tendencies; trade globalization is associated with a reduction in income inequality, while financial globalization is related to an increase in inequality. The results of VECM based Granger causality approach further confirm that technological progress, trade, and financial globalization causes income inequality both directly and indirectly through economic growth and inflation. In case of India, the results of this research can significantly facilitate stakeholders and policymakers in devising policies towards effective globalization and technological innovation for inclusive growth.
The Effects of Capital Formation on Economic Growth in India: Evidence from ARDL-bound Testing Approach
(Sage, 2016-10) Bal, Debi Prasad
This article examines the impact of capital formation on economic growth in India covering the period from 1970 to 2012. This paper traces a long-run equilibrium relation between capital formation and economic growth and other control variables by using autoregressive distributed lag (ARDL) model. The error correction (ECM) model shows that the capital formation, trade openness, exchange rate and total factor productivity positively affect the economic growth and the inflation negatively affects the economic growth in the short run. It is recommended that government increases the level of capital formation in order to achieve a higher level of economic growth.
Examining the Relationship between Sectoral Stock Market Indices and Sectoral Gross Domestic Product: An Empirical Evidence from India
(Global Journals, 2015) Giri, Arun Kumar
This paper aims to examine the relationship between gross domestic product and Indian stock market from a sectoral perspective by using quarterly time series data from 2003:Q4 to 2014:Q4. Ng-Perron unit root test is utilized to check the order of integration of the variables. The long run relationship is examined by implementing the ARDL bounds testing approach to co-integration. VECM method is used to test the short and long run causality and variance decomposition is used to predict long run exogenous shocks of the variables. The results of the ARDL bounds test confirm the existence of a cointegrating relationship between sectoral GDP and sectoral stock price in India. The results from long-run and short-run coefficient reveals that sectoral price indices are significantly influenced by changes in the respective sectoral GDP in the long-run, whereas, crude oil price is an important factor influencing the sectoral prices in the short-run. The granger causality test demonstrates a unidirectional short-run causality running from manufacturing sector GDP to aggregate stock price index of manufacturing sector. Further, the short-run causality running from electricity, gas and water supply sector GDP to respective sector stock price index. However, unidirectional short-run causality is absent in the service secto
Financial development and income inequality in India: an application of ARDL approach
(Emerald, 2015-01) Giri, Arun Kumar
The purpose of this paper is to examine the relationship between financial development and income inequality in India using annual data from 1982-2012.
Impact of Inflation on Financial Development: Evidence from India
(IPE, 2016-09) Giri, Arun Kumar
Financial development is considered an important driver of economic growth, but high level of inflation impedes the ability of the financial sector to allocate resources effectively. This paper examines the impact of inflation on financial development in Indian economy for the period of 1970-2012. To test for stationarity, the study uses Ng- Perron unit root tests. The long- and short-run dynamics are obtained by using auto-regressive distributed lag (ARDL) approach to co-integration and Granger causality is used to examine the direction of the causal link among the variables. The empirical evidence indicates that there is a significant, and negative relationship between inflation and both banking sector development indicator both in the short and long run. The empirical findings reveal that high trends of inflation impede the performance of financial markets. The degree of trade openness promotes development of the financial sector.
Infrastructure development and income inequality in India: an empirical investigation
(Inder Science, 2020) Rao, N.V.M.
The purpose of this paper is to investigate the relationship between infrastructure development and income inequality in India from 1991 to 2012, by using the auto regressive distributed lag (ARDL) bound testing approach. The co-integration test confirms the presence of a long run relationship between infrastructure development and income inequality. The ARDL test results indicate that infrastructure development does not help in reducing income inequality. Both inflation and economic growth amplify the income inequality both in the long run as well as the short run whereas trade openness comes out to be the indicator which is able to decrease the gap between rich and poor in India. The study calls for adopting economic policies and reforms which are aimed at developing and strengthening the infrastructure levels, bringing in more investment in order to achieve the much required inclusive growth, and ultimately reduce the income inequality currently prevailing in India.
Macroeconomic Variables and Stock Market Development in India: An Application of ARDL Bounds Testing Approach
(The Empirical Economics Letters, 2015-07) Giri, Arun Kumar
This paper examines the relationship between selected macroeconomic variables and stock market development in India using quarterly data from 1996:Q1 to 2012:Q3. Ng-Perron unit root test is utilized to check the order of integration of the variables. The long-run relationship is examined by implementing the ARDL bounds testing approach. VECM method is used to test the short and long-run causality, and variance decomposition is used to predict long-run exogenous shocks of the variables. Results confirm a long-run relationship among the variables. Evidence suggests that economic growth, FIIs and Trade openness in India influence the stock market capitalization positively. The VECM result indicates short-run unidirectional causality running from trade openness to stock market development. Result of variance decomposition shows that stock market development is mostly explained by trade openness. The Government can take steps to encourage FDI and trade openness to facilitate investment in stock markets, which will lead to increased economic activity
Public debt and economic growth in India: A reassessment
(Elsevier, 2014-08) Bal, Debi Prasad
This paper examines the effect of public debt on economic growth in India between 1980 and 2011. Using the autoregressive distributed lag ARDL model, the paper traces a long-run equilibrium relationship between public debt and economic growth. The error correction model (ECM) results show that central government debt, total factor productivity (TFP) growth, and debt-services are affecting the economic growth in the short-run, and that the results are consistent with our a priori expectation. It is recommended that the government should follow the objective of inter-generational equity in fiscal management over the long term in order to stabilize debt-GDP ratio, particularly, after the global financial crisis.