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Does Devaluation work for India?

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  • Artatrana Ratha

    ()
    (St. Cloud State University)

Abstract

Whether currency devaluation helps economic growth is an empirically open question. Despite its policy-implications, the issue has received relatively scant econometric attention. Since the results are specific to the sample, model, and techniques employed, country-specific studies have received renewed interest. Coexistence of successive currency devaluations and a booming economy makes India a unique case-study. Using latest data and the bounds-testing approach to cointegration and error-correction modeling, this paper finds that rupee's devaluation is expansionary in India.

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Bibliographic Info

Article provided by AccessEcon in its journal Economics Bulletin.

Volume (Year): 30 (2010)
Issue (Month): 1 ()
Pages: 247-264

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Handle: RePEc:ebl:ecbull:eb-09-00392

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Related research

Keywords: Devaluation; Expansionary effects; India; Rupee; bounds-testing; cointegration;

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References

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Citations

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Cited by:
  1. Tiwari, Aviral & Shahbaz, Muhammad, 2011. "India's trade with USA and her trade balance: An empirical analysis," MPRA Paper 29023, University Library of Munich, Germany.
  2. Muhammad Shahbaz & Faridul Islam & Naveed Aamir, 2012. "Is devaluation contractionary? Empirical evidence for Pakistan," Economic Change and Restructuring, Springer, vol. 45(4), pages 299-316, November.
  3. Mohsen Bahmani & Hanafiah Harvey & Scott W. Hegerty, 2013. "Empirical tests of the Marshall-Lerner condition: a literature review," Journal of Economic Studies, Emerald Group Publishing, vol. 40(3), pages 411-443, May.

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