Economic Growth and Trade-related Variables: An Empirical Study Using Indian Data

Abstract

The present study deals with the growth performance of export (X), ­import (M), and economic growth (Y) in India over the period 1970–1971 to 2016–2017 as well as tariff (TR) for the period 1990–2017 by employing the methodology of one-time endogenous structural break suggested by Zivot and Andrews (1992). Also, an attempt has been taken to examine the direction of causality between the above-mentioned trade-related variables and economic growth using Granger Causality Test. Results of estimation reveal that all the variables converge toward a stationarity process having constant variability overtime. There exists structural break in the year 1996, 2006, 2008, and 2010, respectively, for economic growth, tariff, imports, and exports. Bidirectional causality is found running from economic growth to tariff and from tariff to economic growth. But there is unidirectional causality from imports to tariff, imports to exports and from exports to tariff.

Citation

Chakraborty, C. and Jana, A. (2021), "Economic Growth and Trade-related Variables: An Empirical Study Using Indian Data", Das, R.C. (Ed.) Global Tariff War: Economic, Political and Social Implications, Emerald Publishing Limited, Leeds, pp. 141-152. https://doi.org/10.1108/978-1-80071-314-720211011