Inflation, uncertainty and monetary policy in India: a regime-switching analysis

Sudhanshu Kumar ()

Economics Bulletin, 2015, vol. 35, issue 4, 2213-2219

Abstract: Based on the characteristics of the inflation data for India, the paper first identifies the possible number of significantly different regimes using Kernel density estimates; and then it estimates a Markov-switching model using the Maximum Likelihood Estimation. Estimated results suggest that high inflation uncertainty in India has not only been a feature of very high levels of inflation but is also associated with the low levels.

Keywords: Inflation; Uncertainty; Monetary Policy; Markov-switching; Bootstrap Multimodality test (search for similar items in EconPapers)
JEL-codes: E0 E5 (search for similar items in EconPapers)
Date: 2015-10-16
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Citations: View citations in EconPapers (1)

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