IDEAS home Printed from https://ideas.repec.org/a/taf/macfem/v14y2021i2p157-179.html
   My bibliography  Save this article

Asymmetric fiscal multipliers in India – Evidence from a non-linear cointegration

Author

Listed:
  • Javed Ahmad Bhat
  • Naresh Kumar Sharma

Abstract

We attempted to scrutinize the efficacy of fiscal policy tools on key macroeconomic variables in case of India. Applying an asymmetric cointegration framework, the impact of public spending hike on output growth is significantly favourable and that of the decrease in it is insignificant. Similarly, effect of tax hikes is more pronouncing than tax cuts. Comparatively, results report more effectiveness of spending hikes than the tax cuts to avoid an economic downturn and tax hikes than spending cuts to cool down a heating economy. Private consumption mimics response of output growth, whereas response of private investment follows the substitutability hypothesis.

Suggested Citation

  • Javed Ahmad Bhat & Naresh Kumar Sharma, 2021. "Asymmetric fiscal multipliers in India – Evidence from a non-linear cointegration," Macroeconomics and Finance in Emerging Market Economies, Taylor & Francis Journals, vol. 14(2), pages 157-179, May.
    • Handle: RePEc:taf:macfem:v:14:y:2021:i:2:p:157-179
    DOI: 10.1080/17520843.2020.1818802
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/17520843.2020.1818802
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/17520843.2020.1818802?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:macfem:v:14:y:2021:i:2:p:157-179. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/REME20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.