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Fiscal Deficit and Inflation: An empirical analysis for India

Author

Listed:
  • Aviral Kumar Tiwari

    (ICFAI University, Tripura)

  • A. P. Tiwari

    (Department of Economics, Vidyant Hindu College, University of Lucknow, Lucknow)

Abstract

This study examines the linkage between fiscal deficit and inflation in India. The main objective of this study is to examine the factors that are responsible for increasing fiscal deficit in India, by taking into account all factors that can affect the status of fiscal deficit. The study finds that inflation is not at all cause of fiscal deficit. However, government expenditure and money supply are found to be important determinants of mounting fiscal deficit.

Suggested Citation

  • Aviral Kumar Tiwari & A. P. Tiwari, 2011. "Fiscal Deficit and Inflation: An empirical analysis for India," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 14(42), pages 131-158, December.
    • Handle: RePEc:rej:journl:v:14:y:2011:i:42:p:131-158
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    References listed on IDEAS

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    7. Sadia Tahir, 2006. "Core Inflation Measures for Pakistan," SBP Research Bulletin, State Bank of Pakistan, Research Department, vol. 2, pages 319-342.
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    Cited by:

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    2. Gurleen Kaur, 2021. "Inflation and Fiscal Deficit in India: An ARDL Approach," Global Business Review, International Management Institute, vol. 22(6), pages 1553-1573, December.

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    More about this item

    Keywords

    Budget Deficit; Inflation; Money supply.;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus

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