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Indebtedness, Fiscal Discipline and Development Spending – A Non-parametric Approach

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  • Ram Pratap Sinha

    (Government College of Engineering and Leather Technology, Kolkata)

Abstract

Indian states exhibit considerable heterogeneity in terms of revenue mobilizing capacities and efforts, development spending and fiscal dependence on the central government. In this context, the paper compares the fiscal performance of major Indian states in terms of two non-parametric performance evaluation models for the period 2009–10 to 2014–15. The study thus uses the conventional two stage framework for efficiency evaluation as well as the two stage conditional performance model. The outcomes enable us to identify front-runners as well as laggards in the area of fiscal management. Further, the study showed that the gross capital formation experienced by the states significantly influences state performance in India. However, the impact of outstanding liabilities on efficiency performance was statistically insignificant.

Suggested Citation

  • Ram Pratap Sinha, 2021. "Indebtedness, Fiscal Discipline and Development Spending – A Non-parametric Approach," Central European Journal of Economic Modelling and Econometrics, Central European Journal of Economic Modelling and Econometrics, vol. 13(2), pages 147-173, June.
    • Handle: RePEc:psc:journl:v:13:y:2021:i:2:p:147-173
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    More about this item

    Keywords

    Indian states; fiscal performance; efficiency; data envelopment analysis; bootstrap;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis

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