Macroeconomic variables and the performance of the Indian Stock Market

Atsuyuki Naka, Tarun Mukherjee and David Tufte ()
Additional contact information
Atsuyuki Naka: University of New Orleans
Tarun Mukherjee: University of New Orleans

No 1998-06, Working Papers from University of New Orleans, Department of Economics and Finance

Abstract: In this paper we analyze relationships among selected macroeconomic variables and the Indian stock market. By employing a vector error correction model, we find that three long-term equilibrium relationships exist among these variables. Our results suggest that domestic inflation is the most severe deterrent to Indian stock market performance, and domestic output growth is its predominant driving force. After accounting for macroeconomic factors, the Indian market still appears to be drawn downward by a residual negative trend. We attribute this to economic mismanagement, since the size of the downward pull mitigates after 1990, coinciding with the beginning of Indian economic reforms.

Keywords: India; Bombay Stock Exchange; Cointegration; Johansen method; Identification (search for similar items in EconPapers)
JEL-codes: G15 (search for similar items in EconPapers)
Pages: 31 pages
Date: 1998
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://louisdl.louislibraries.org/cgi-bin/showfile.exe?CISOROOT=/EFW&CISOPTR=14 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Can't connect to louisdl.louislibraries.org:80 (No such host is known. )

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:uno:wpaper:1998-06

Access Statistics for this paper

More papers in Working Papers from University of New Orleans, Department of Economics and Finance Contact information at EDIRC.
Bibliographic data for series maintained by Janet Murphy Crane ().