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What Causes Trade-led Growth in India?

Author

Listed:
  • Ruchi Gupta

    (Dyal Singh College, University of Delhi, Delhi. Address for Correspondence: A-33, Lok Vihar, Pitampura, Delhi-110034, email: ruchigupta2508@yahoo.co.in)

Abstract

The impact of the recent rise in India’s exports on its economic growth is tested using the Johansen cointegration technique. On using different measures of both trade and economic growth variables, a unidirectional causality has been found from trade to economic growth. It is concluded that in India the most important sources of causation from trade to economic growth have been externalities generated by the export sector and a relatively higher productivity of the export sector, while no evidence is found in favour of a positive impact of knowledge spillovers generated by trade on economic growth.

Suggested Citation

  • Ruchi Gupta, 2011. "What Causes Trade-led Growth in India?," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 5(3), pages 293-310, August.
    • Handle: RePEc:sae:mareco:v:5:y:2011:i:3:p:293-310
    DOI: 10.1177/097380101100500301
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    References listed on IDEAS

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    More about this item

    Keywords

    R&D Spillovers; Externalities; Productivity Differential; Causality Direction; Johansen Cointegration; JEL Classification: F43; JEL Classification: C32;
    All these keywords.

    JEL classification:

    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models

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