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Disequilibrium in the Indian Registered Manufacturing Sector-A Simulated Maximum Likelihood Analysis

Author

Listed:
  • HARISH MANI

    (Department of Economics Sri Sathya Sai Institute of Higher Learning)

  • V. PANDIT

    (Department of Economics Sri Sathya Sai Institute of Higher Learning)

  • R. PRABHAKAR RAO

    (Department of Economics Sri Sathya Sai Institute of Higher Learning)

Abstract

How a macroeconomic policy package is designed depends critically on whether the economy in question is supply constrained or demand constrained. In simple terms, this may often be seen in terms of whether the policies should try to augment demand or to raise productive capacity. The question is relevant to objectives of growth as well as stability. In the present study, we examine this problem with regard to the registered manufacturing sector in India, within a framework of market disequilibrium for the period 1980 through 2007. The maximum simulated likelihood approach used by us indicates that the registered manufacturing sector in India has largely been demand-constrained over the entire period of analysis.

Suggested Citation

  • Harish Mani & V. Pandit & R. Prabhakar Rao, 2013. "Disequilibrium in the Indian Registered Manufacturing Sector-A Simulated Maximum Likelihood Analysis," Working papers 222, Centre for Development Economics, Delhi School of Economics.
    • Handle: RePEc:cde:cdewps:222
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    References listed on IDEAS

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    More about this item

    Keywords

    Disequilibrium; Demand / Supply constrained; Regime-switching; Simulated-maximum likelihood.;
    All these keywords.

    JEL classification:

    • C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models; Threshold Regression Models
    • D45 - Microeconomics - - Market Structure, Pricing, and Design - - - Rationing; Licensing
    • C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques

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