Pub Date : 2020-09-30DOI: 10.35609/jber.2020.5.2(1)
Rashmi Gupta, Swati Shastri
Objective – The objective of this study is to test direction of causality between components of public expenditure and economic growth in India. Methodology/Technique – The paper uses annual data for the period 1980-2015. To measure public expenditure, plan expenditure and non-plan expenditure are used. The econometric methodology employed is Vector Auto regression (VAR) model. Findings – First, the stationary properties of the data were tested using Augmented Dickey-Fuller (ADF) test, Dickey-Fuller (DF) test, and the Phillip-Perron (PP) test and found that variables were non-stationary in level, but stationary in first differences. Then, Johansen- Jueslius cointegration test was employed to test the long-run association among the variables and results suggest an absence of any long-run association between plan expenditure and non-plan expenditure and economic growth in India. The Granger Causality test suggests there is unidirectional causality running from economic growth and non-plan expenditure and plan expenditure and non-plan expenditure and absence of causality public expenditure and economic growth. Novelty – The results of the Forecast Error Variance Decompositions test indicated that innovations in the variables are mostly explained by their own shocks. The impulse responses of the economic growth, plan expenditure and non-plan expenditure with respect to identified shocks are consistent with the results of Variance Decomposition Analysis. Type of Paper: Empirical. JEL Classification: O4, O49, O53. Keywords: Plan Expenditure; Non-plan Expenditure; Economic Growth; Unit Root; Cointegration Test; Granger Causality Test; Forecast Error Variance Decomposition; Impulse Responses. Reference to this paper should be made as follows: Gupta, R; Shastri, S. 2020. Public Expenditure and Economic Growth in India: An Empirical Analysis Using Vector Autoregression (VAR) Model, J. Bus. Econ. Review 5(2) 45– 58 https://doi.org/10.35609/jber.2020.5.2(1)
目的-本研究的目的是测试印度公共支出组成部分与经济增长之间的因果关系方向。方法/技术-本文使用1980-2015年期间的年度数据。衡量公共支出，使用计划支出和非计划支出。采用的计量经济学方法是向量自回归(VAR)模型。研究结果-首先，使用增强迪基-富勒(ADF)检验、迪基-富勒(DF)检验和菲利普-佩隆(PP)检验对数据的平稳性进行了检验，发现变量在水平上是非平稳性的，但在第一差异上是平稳性的。然后，采用Johansen- Jueslius协整检验检验变量之间的长期相关性，结果表明印度的计划支出和非计划支出与经济增长之间不存在任何长期相关性。格兰杰因果检验表明，经济增长与非计划支出、计划支出与非计划支出以及公共支出与经济增长之间存在单向因果关系。新颖性-预测误差方差分解检验的结果表明，变量的创新主要是由它们自身的冲击来解释的。经济增长、计划支出和非计划支出对识别冲击的脉冲响应与方差分解分析的结果一致。论文类型:实证。JEL分类:O4, O49, O53。关键词:计划支出;Non-plan开支;经济增长;单位根;协整检验;格兰杰因果检验;预测误差方差分解;脉冲响应。本文的参考文献如下:Gupta, R;Shastri, S. 2020。《公共支出与经济增长:基于向量自回归(VAR)模型的实证分析》[j]。经济学。复习5(2)45 - 58 https://doi.org/10.35609/jber.2020.5.2(1)
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