Indira Gandhi Institute of Development Research

About: Indira Gandhi Institute of Development Research is a facility organization based out in Mumbai, Maharashtra, India. It is known for research contribution in the topics: Monetary policy & Inflation. The organization has 307 authors who have published 1021 publications receiving 18848 citations.

Do Size-dependent Tax Incentives Discourage Plant Size Expansion? Evidence from Panel Data in Indian Manufacturing:

Abstract: The article presents a new empirical application of the idea of threshold burden of tax incentives in India. The Indian government provided tax exemption to manufacturing units with sales turnover ...

Electoral Outcomes and Provision of Public Goods: A Case Study of India

Abstract: This paper analyses the implications of political factors on provision of public goods by state governments in India. Using data on state governments’ expenditure and constituency results of states' Legislative Assembly elections during the period 1971–2005, it demonstrates that the greater the spread of ruling party's strength across legislative constituencies in a state, the higher the share of developmental expenditure in revenue budget. It also documents that the share of developmental expenditure in revenue budgets is positively associated with voter turnout and with a change in the political party in power. Interestingly, delivery of public goods in a state does not appear to have any significant relation to the form of the government – single party or coalition. It also shows that economic liberalization has reduced governments’ responsiveness to provision of public goods.

Choice of Union-firm Bargaining Agenda and Social Welfare

Abstract: This paper shows that with a strong labour union, bargaining over piece rate generates higher social welfare than bargaining over fixed wage. Moreover, this social welfare exceeds the social welfare under efficient bargaining level, if the union is very strong.

Reassessing exchange rate overshooting in a monetary framework

Abstract: Money overtime has been deemphasized from most of the macroeconometric models of exchange rate making interest rate 'alone' the monetary policy instrument. One such model is Bjornland's (1999) Journal of International Economics and Monetary Policy and Exchange Rate Overshooting: Dornbusch was right after all. The model sets out to establish the empirical validity of Dornbusch exchange rate overshooting hypothesis for four small open economies. It does so though not with exact precision. When the same model is done using the correct econometric techniques, the impulse response functions for exchange rate due to a monetary policy shock are infact 'insignificant'. In this paper we revisit the Dornbusch exchange rate overshooting in a different model setting. A real money demand equations is added to the original model. Identification is achieved by imposing short-run and long-run restrictions while keeping the short-run interactions between the two variables monetary policy and exchange rate free. Classical neutrality of money is imposed according to which the monetary shocks are long-run neutral to certain real variables. Our paper rediscovers the validity of Dornbusch Overshooting hypothesis for Australia, Canada, Newzealand and Sweden when we compare it with Bjornland's model. More specifically, a contractionary monetary policy shock leads to exchange rate overshooting as predicted by Dornbusch. The exchange rate appreciates 'significantly' on impact to a monetary policy shock as shown by the impulse response functions and thereafter depreciates. Also the variance decomposition results justify our analysis by showing that money demand and money supply shocks explain siginificant portion of exchange rate fluctuations vis-a-vis Bjornland's original model.

Land-holding, participation in agriculture and short-term migration in rural India

Abstract: We analyse a nationally representative data set from India for the year 2013 in order to provide evidence on how short-term migration is affected by household ownership of land and participation in...