Please use this identifier to cite or link to this item: https://hdl.handle.net/11499/47544
Title: Income Convergence of Indian States in the Post-Reform Period: Evidence From Panel Stationarity Tests With Smooth Structural Breaks
Authors: Misra, Biswa Swarup
Kar, Muhsin
Nazlioglu, Saban
Karul, Cagin
Keywords: Income Convergence
India
Structural Shifts
Panel Data
Publisher: Routledge Journals, Taylor & Francis Ltd
Abstract: This paper investigates income convergence of Indian states in the post-reform period when markets played a greater role in resource allocation. We analyze stochastic convergence of relative per capita incomes of 19 states for the period 1994-2018 by employing a recently developed panel data approach controlling for structural breaks as smooth shifts. Smooth shifts are modelled using a more flexible Fourier approach that does not require identifying the number, date, and form of breaks. The empirical results, contrary to recent empirical findings, do not support evidence in favour of convergence in per capita income among Indian states. Poor infrastructure, lack of adequate financial development, and weak governance structure coupled with low total factor productivity growth seem to be responsible for the divergence of income. The findings suggest that development intervention in the post-reform period has neither been of the required order nor in the desired direction to help the lagging states to catch up with the leading ones.
Description: Misra, Biswa/0000-0003-1139-0959; Karul, Cagin/0000-0002-5856-930X
URI: https://doi.org/10.1080/13547860.2021.2022352
ISSN: 1354-7860
1469-9648
Appears in Collections:İktisadi ve İdari Bilimler Fakültesi Koleksiyonu
Scopus İndeksli Yayınlar Koleksiyonu / Scopus Indexed Publications Collection
WoS İndeksli Yayınlar Koleksiyonu / WoS Indexed Publications Collection

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