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Kaur, Ramandeep
- Modeling International Trinity & Policy Choices for India
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1 Department of Economics, Panjab University, Sector-14, Chandigarh-160014, IN
1 Department of Economics, Panjab University, Sector-14, Chandigarh-160014, IN
Source
Indian Journal of Industrial Relations: Economics & Social Dev., Vol 54, No 4 (2019), Pagination: 631-643Abstract
This study is an attempt to test the validity of trinity hypothesis and to measure the cost of capital account convertibility which Indian economy has paid in the form of one of the cornerns of trinity triangle. The monthly data obtained from various publications of RBI and IMF over the period 1980:M1 to 2016:M12 have been utilized to construct three trinity indices of Monetary Independence (MI), Exchange Rate Stability (ERS), and Capital Account Openness (CO).Using the graphical and cointegration tools, the existence of trinity hypothesis has been confirmed in Indian context. It has been noticed that India has clearly chosen capital openness (CO) over exchange rate stability (ERS).
References
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Authors
Affiliations
1 Department of Economics, Panjab University, Sector-14, Chandigarh 160014, IN
1 Department of Economics, Panjab University, Sector-14, Chandigarh 160014, IN
Source
Indian Journal of Industrial Relations: Economics & Social Dev., Vol 55, No 1 (2019), Pagination: 1-14Abstract
Many national and international agencies blame demonetization as a major factor behind the deceleration in the growth rate of Indian economy in recent quarters. Such linkages of economic growth with monetary shocks have been well explained by Hawtrey’s monetary theory of business cycles. The present paper attempts to test Hawtrey’s theory in the context of demonetization in India. The results indicate that the Indian economy did experience fourteen growth-rate cycles over the period 1970 to 2017. Given that M3 takes an average 7 months lead in explaining the low growth (i.e., downswing) phase, the demonetization (i.e., fall in money supply) can be admitted as a lead because of falling growth rate of Indian economy.References
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Authors
Affiliations
1 Research Scholar, Department of Economics, Panjab University, Chandigarh 160014, IN
1 Research Scholar, Department of Economics, Panjab University, Chandigarh 160014, IN