Author/Authors :
Bhattacharya, Sharad Nath Army Institute of Management, India , Bhattacharya, Mousumi Army Institute of Management, India
Title Of Article :
Capital Inflows and Economic Growth: An Indian Perspective
Abstract :
The paper investigates the possible cointegration and the direction of causality between various components of capital inflows and economic growth in India. A cointegration test is performed in a vector autoregression (VAR) framework followed by an application of a Vector-Error Correction Model (VECM), Granger Causality test and Impulse response analysis. Bi-directional causality is observed between foreign direct investment (FDI) and economic growth, external assistance and economic growth, external assistance and other capital. Unidirectional causality is observed from foreign portfolio investment (FPI) and other capital to economic growth, and from economic growth to NRI (Non- Resident Indians) deposit.
NaturalLanguageKeyword :
capital inflows , GDP , VECM , Multivariate Granger , causality
JournalTitle :
Bogazici Journal
