Macroeconomic Implications of Capital Inflows in India
AbstractThe study attempts to analyse the behaviour of some macroeconomic variables in response to total capital inflows in India using quarterly data for the period 1994Q1-2007Q4. Time trend of all variables except nominal effective exchange rate-both export and trade based and current account balance shows instability over the period of study. Current account balance is the only variable which is stationary in level form all other variables are stationary in first difference form. Cointegration test confirms the long run equilibrium relation between total capital inflows (TCI) and real effective exchange rate-both trade based and export based and between TCI and nominal effective exchange rate-export based. Granger causality test confirms the bidirectional causality between real effective exchange rate-export based and TCI and between foreign exchange reserve & TCI and unidirectional causality from TCI to real effective exchange rate-trade based.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 19299.
Date of creation: 06 Mar 2009
Date of revision: 06 Oct 2009
Publication status: Published in International Review of Business Research Papers 6.5(2009): pp. 133-147
International Capital Inflows; Time Series Econometrics;
Find related papers by JEL classification:
- F30 - International Economics - - International Finance - - - General
- C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models &bull Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-12-19 (All new papers)
- NEP-CWA-2009-12-19 (Central & Western Asia)
- NEP-IFN-2009-12-19 (International Finance)
- NEP-OPM-2009-12-19 (Open Economy Macroeconomics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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