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Authors
Affiliations
1 RBI Endowment Unit, Institute for Social and Economic Change (ISEC), Nagarabhavi, Bangalore-72, IN
2 Economics Unit, Institute for Social and Economic Change (ISEC), Nagarabhavi, Bangalore-72, IN
3 Economics Unit, ISEC, Nagarabhavi, Bangalore-72, IN
Source
Journal of Indian School of Political Economy, Vol 13, No 4 (2001), Pagination: 583-593
Abstract
This paper examines the dynamic relationship between fiscal deficits, money supply, and price level in India during the period 1960-61 to 1999-2000. Using vector autoregression (VAR) econometric methodology, which allows variables to be treated as potentially endogenous, the study finds that fiscal deficits and money supply are both influenced by each other. Further, it reveals that the price level does not influence either the fiscal deficit or money supply but rather is being influenced by both the variables.