Revisiting India’s Growth Transitions

Deepankar Basu ()
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Deepankar Basu: Department of Economics, University of Massachusetts Amherst

UMASS Amherst Economics Working Papers from University of Massachusetts Amherst, Department of Economics

Abstract: This paper reconsiders two questions relating to India’s economic growth: structural breaks in growth and the impact of equipment investment on aggregate economic growth. First, statistical tests of structural change show that economic growth in post-independence India has witnessed four structural breaks: in 1964-65, in 1978-79, in 1990-91, and in 2004-05. However, substantial growth accelerations, i.e. increase of more than 1.0% per annum in the growth rate of per capita real GDP, occurred only at two points: 1978-79 and 2004-05. Second, to analyze the impact of equipment investment on growth, I use an ARDL bounds testing methodology. I find a positive and statistically significant long run positive impact of private investment in equipment and machinery on the growth rate of real GDP.

Keywords: India; economic growth; structural change; ARDL bounds testing. (search for similar items in EconPapers)
JEL-codes: O11 O47 O53 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-cwa and nep-gro
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