An augmented P-star model of Indian inflation |
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| Authors: | Peter Holzschuh Ankita Mishra Jayant Misra Imad A Moosa Shyam Nath |
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| Institution: | 1. Centre for Economics and Governance, Amrita Vishwa Vidyapeetham , Kollam, India;2. School of Economics, Finance and Marketing, Royal Melbourne Institute of Technology , Melbourne, Australia;3. Amrita School of Business, Amrita Vishwa Vidyapeetham , Coimbatore, India |
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| Abstract: | ABSTRACT An augmented P-Star model is estimated and tested to identify the drivers of inflation in India. The model includes monetary and non-monetary factors, demand-pull and cost-push factors, and domestic as well as foreign factors. The results show that inflation in India is driven by a combination of monetary factors and non-monetary factors, some of which affect inflation on the supply side while others operate on the demand side. It turns out, however, that inflation in India is determined more by domestic rather than foreign factors. |
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| Keywords: | Inflation India P-star model structural time series modelling |
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