Indian Institute of Technology Hyderabad (IITH) is a premier institute of science and technology established in 2008. IITH has been consistently ranked in the&nbsp;<a href="https://iith.ac.in/reports/" rel="noopener noreferrer">top 10 institutes</a>&nbsp;in India for Engineering&nbsp;<a href="https://www.nirfindia.org/2021/EngineeringRanking.html" rel="noopener noreferrer" target="_blank">according to NIRF</a>&nbsp;making it one of the most coveted schools for science and technology in the country.

IITH offers&nbsp;<a href="https://iith.ac.in/academics/under-graduate/">undergraduate programs</a>&nbsp;in all the classical engineering disciplines, applied sciences, design, as well as several modern interdisciplinary areas. Students are given a flexibility to explore a broad set of areas, and potentially pursue a minor or double major in a discipline that is not their own. Students who wish to seek a deeper understanding of their own discipline are strongly encouraged to get involved in cutting-edge research with the help of a faculty to mentor them, and earn an Honors in their own field.

The very foundation of IIT Hyderabad is based on&nbsp;<a href="https://iith.ac.in/research/">research and innovation</a>. The vibrant research culture is evident from the number of patents and publications that IITH produces consistently every year. IITH offers&nbsp;<a href="https://iith.ac.in/academics/programmes-offered/">graduate programs</a>&nbsp;at both a masters, and a doctoral level, in several diverse areas. There are separate programs for technology, design, science, and liberal arts. The&nbsp;<a href="https://iith.ac.in/academics/post-graduate/">MTech program</a>&nbsp;is offered in various modes and durations to cater to the ever-growing need of postgraduate level professionals in the country.

IITH encourages and supports&nbsp;<a href="https://iic-iith.netlify.app/index.html" rel="noopener noreferrer" target="_blank">innovation and entrepreneurship</a>&nbsp;at every stage. The minor program in entrepreneurship is open to all students of IITH, and many of the courses are offered by industrialists who are entrepreneurs themselves. There are various&nbsp;<a href="https://iith.ac.in/research/centres-incubators/">innovation centers and incubators</a>&nbsp;that promote entrepreneurship and help mentor young innovators. IITH has been very successful in building tie-ups with leading academic institutions around the globe.

IITH enjoys a very special relationship with Japanese universities and industries that goes beyond academic and research collaborations. In fact, some of the iconic buildings in IITH campus will carry the signature of Japanese architecture.

IITH creates a unique holistic ecosystem for education that offers interactive learning, a very flexible academic structure, cutting-edge research, strong industry collaboration, and entrepreneurship. This is an environment which enables students and faculty to translate their dreams into realities.

IIT Hyderabad

We revisit the twin deficits hypothesis (budget and trade deficits) for the United States during 1791–2019, using the system-equation ADL test for threshold cointegration proposed by Li (2017). This model can demonstrate the existence of both asymmetric adjustment and asymmetric role in the relationship between trade and budget deficits. Our empirical evidence suggests a nonlinear long-run relationship between the two variables, thus finding the presence of the twin deficits hypothesis. Further, we find time–varying cointegration between the two, and an asymmetric adjustment process. Budget deficits play a vital adjustment role at low regimes (when error-correction terms are below the threshold of 1.11), and trade deficits play an important adjustment role at higher regimes (when error-correction terms are above the threshold of 1.11). © 2023 Informa UK Limited, trading as Taylor & Francis Group.

World University root node

Department of Liberal Arts

Journal of International Trade and Economic Development

Revisiting the twin deficits hypothesis in the United States: Further evidence based on system-equation ADL test for threshold cointegration

This article evaluates the sales tax effort for tax revenues of 18 Indian states from 2011–12 to 2016–17, exclusive and inclusive of petroleum tax revenues, using stochastic frontier analysis. From empirical analysis, it is observed that sales tax revenue is significantly influenced by higher non-agriculture GSDP, greater supply of bank credit and higher urbanization. The calculation of Sales tax effort is found to be overstated when petroleum tax revenue is included in sales tax. States' sales tax effort tends to become lower when the influence of petroleum tax revenue is factored out. It is found that Assam, Andhra Pradesh, Gujarat, Kerala and Haryana are the top five states with greater sales tax effort, inclusive of petroleum tax revenue, during the said period. The West Bengal, Maharashtra, Bihar, Goa and Madhya Pradesh are the bottom five states. Further, it is observed that only half of the states in India have shown improvement in their tax effort between 2011–12 and 2016–17, indicating no uniform improvement across the states. From the robustness analysis, a regression model exhibit similar results. Therefore, it can be suggested that assessment of the sales tax effort of Indian states should be made after having excluded the petroleum tax revenues from sales tax. © 2020 John Wiley & Sons Ltd

International Journal of Finance and Economics

Does petroleum tax revenue drive sales tax effort of Indian states? A stochastic frontier approach

Cryptocurrencies have emerged as an important investment avenue in the past few years. Investors are increasingly interested in these currencies amid surging financial returns. In this context, understanding market efficiency of cryptocurrency has become very crucial for investors and academicians. The price–volume framework is a popular approach in financial economics to understand the market efficiency of stocks in the stock markets. Therefore, this article examines the market efficiency of cryptocurrencies through price–volume framework to understand whether crypto market is predictable. Towards this objective, data on both return and trading volume (TV) of the top eight cryptocurrencies are used for the period 8 August 2015–20 October 2022. As an empirical method, both linear and non-linear causality models are used to validate the hypothesis. Our results confirm that TV cannot predict the cryptocurrencies' return, thereby validating the market efficiency hypothesis. Furthermore, we divide the sample according to the structural break period. The result from the post-break period analysis also confirms the presence of market efficiency in the recent period for all currencies, barring XRP, XMR and DASH.

Market efficiency of the cryptocurrencies: Some new evidence based on price–volume relationship

This chapter examines the direction of causality between financial development and economic growth in 44 developed and developing countries for the period of 1965-2016. Using bank-based indicators, our empirical results provide the evidence of linear Granger-causality running from economic growth to financial development in most of the countries, supporting demand-side hypothesis. On the contrary, using stock market-based indicators we find the evidence of unidirectional causality running from financial development to economic growth, supporting supply-side hypothesis. Further, using nonlinear causality test, we observe that a half of the sample countries do not show causality between bank-based financial development and economic growth in either direction, following neutral hypothesis. However, rest of the sample countries show significant nonlinear causality in different directions depending upon the indicators employed. Similarly, employing stock market indicators, we find insignificant nonlinear Granger-causality between financial development and economic growth. Moreover, comparing countries by their inflation level, we find significant linear and nonlinear causality running from financial development to economic growth, supporting supply-side hypothesis in low inflation countries. The high inflation countries show mixed results in the direction of Granger-causality. Similarly, the chapter using stock market indicators confirms both linear and nonlinear causalities from financial development to economic growth in low inflation countries. Further, using bank-based indicators the linear and nonlinear Granger-causality result confirms insignificant Granger-causality in both high income and low income countries. Interestingly, medium income countries show significant nonlinear Granger-causality from financial development to economic growth. But using stock market indicators, we find significant linear Granger-causality from financial development to economic growth. © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021. All rights reserved.

Economic Growth and Financial Development: Effects of Capital Flight in Emerging Economies

Is finance-growth nexus nonlinear? Evidence from linear and nonlinear causality analysis

This paper evaluates the revenue effort of Indian states during the 13th and 14th Finance Commission periods and estimates the impact of central transfers recommended by the Finance Commission on the relative revenue effort of states. Using panel data the study finds that Bihar, Uttar Pradesh, Madhya Pradesh, Assam and Kerala are the top five states with the greatest relative revenue effort. Further, the impact of central transfers on revenue effort was found to be negative, suggesting that greater devolution encourages laxity in the state's tax collection efficiency by providing perverse incentives. © 2019 The University of Melbourne, Melbourne Institute: Applied Economic & Social Research, Faculty of Business and Economics

Australian Economic Review

Central Transfer a Curse or Blessing? Evidence from the Relative Revenue Effort of Indian States

This paper examines whether the fiscal deficit limit of 3% as prescribed by the FRBMA is justified keeping in mind the increasing spending requirement and economic growth of Indian states? The study uses a panel data framework of taking sixteen non-special category states of India for the period over 2001–2002 to 2016–2017. This paper is the first of its kind that uses a threshold regression model due to Khan and Senhadji (IMF Staff Papers 48(1):1–21, 2001) to find the threshold level of fiscal deficit. The empirical findings show that the threshold level of fiscal deficit in sixteen states taken together is found to be 3%, which is in the line of prescribed limit of FRBM act. But at disaggregated level, it is observed that in middle- and low-income states the threshold level of fiscal deficit is 3.9% and 3.5%, respectively. This suggests that states can go for some additional percent of fiscal deficit above the limit prescribed by FRBMA. Therefore, the fiscal deficit limit of 3% needs to be revisited to give more fiscal room to the Indian states. © 2020, Institute for Social and Economic Change.

Journal of Social and Economic Development

Threshold level of fiscal deficit: revisiting FRBMA limit in Indian states

This article examines the relationship between Inflation targeting (IT) and financial instability from 1990 to 2015 for Asian economies. To measure financial instability, a multidimensional financial conditioning index is calculated following the ECB's approach. Using a fixed effects panel data model the study finds that adoption of IT policy in Asian economies has an adverse impact on financial stability, thus rejecting the ‘conventional wisdom’ hypothesis. Further, the Vector Autoregression (VAR) result shows that an IT regime increases housing returns and encourages investors to take higher risks. © 2019 The University of Melbourne, Melbourne Institute: Applied Economic & Social Research, Faculty of Business and Economics

Monetary Policy and Financial Stability: The Role of Inflation Targeting

This paper examines the link between economic growth and fiscal deficit in India for the periods between 1970–71 to 2016–17 and 1970–71 to 2003–04. The study uses an autoregressive distributed lag (ARDL) bound testing model. To check for robustness, a fully modified ordinary least square is also used. The ARDL bound test confirms both long-run relationship between fiscal deficit and economic growth after accounting for capital formation, electricity consumption and inflation. We find that the fiscal deficit has an adverse impact on growth over both the periods. Therefore, implementation of FRBM Act, 2003 has not impacted fiscal deficit-growth nexus differently. © 2019, © 2019 Informa UK Limited, trading as Taylor & Francis Group.

Macroeconomics and Finance in Emerging Market Economies

Has FRBM rule influenced fiscal deficit-growth nexus differently in India?

Inflation targeting (IT) has been popular in emerging economies despite its early adoption in advanced countries. This paper seeks to find out whether the presence of the IT regime for the Asian countries enhance credibility of the central banks. The study makes use of two episode methods in the calculation of sacrifice ratio for the period 1970–2014 for 13 Asian economies. Empirical findings based on annual data suggest that an IT regime indeed enhances credibility of the central banks. The low sacrifice ratio in IT countries is explained by the implementation of IT regime. The IT policy has potential to reduce sacrifice ratios by 3.7–5.7 points. Among other determinants initial inflation is found to be significant in Asian economies. However, the speed of disinflation remains insignificant irrespective of the method used in the analysis. These findings do not support the idea that IT and speed can be used alternatively as credible monetary policy. © 2017, Springer Science+Business Media, LLC, part of Springer Nature.

Economic Change and Restructuring

Credibility of inflation targeting: some recent Asian evidence

Purpose: The purpose of this paper is to examine the relationship between financial inclusion (FI) and economic growth in India. Design/methodology/approach: To measure FI, a multidimensional time-varying index is proposed following the Human Development Index method. The long-run relationship between FI and economic growth is examined by using the autoregressive distributed lag (ARDL) approach to cointegration and nonlinear ARDL approach. Further, the direction of causality is investigated by employing the Toda–Yamamoto Granger causality test. Findings: The linear cointegration test confirms a long-run relationship between FI and economic growth for India. The improvement in both demand-side and supply-side financial services has a positive impact on economic growth. These results suggest that India can attain long-run economic growth by improving the coverage of FI. However, there is no evidence of nonlinear cointegration, indicating that there is no asymmetric effect of FI on economic growth. Further, the causality test shows that FI granger causes economic growth but not vice versa. Research limitations/implications: The major limitation of the study is the availability of time series data for all important variables. The index for both demand- and supply-side indicators can be extended with several other important variables in later date once the data are available for those variables. Practical implications: As the study confirms that FI is one of the main drivers of economic growth, it is suggested that the policy maker emphasizing on financial sector reforms can enjoy economic growth in the long run, especially in developing countries. Therefore, the government and policy makers need to address the issues involved in access to financial services to spur economic growth. Originality/value: The study examines the long-run relationship between FI and economic growth employing ARDL bound testing approach and nonlinear ARDL approach, separately for demand-side and supply-side indicators. Further, the study uses the Toda–Yamamoto granger causality to find the direction of causal flow between FI and economic growth. © 2019, Emerald Publishing Limited.

International Journal of Social Economics

Financial inclusion matters for economic growth in India: Some evidence from cointegration analysis

Purpose: The purpose of this paper is to examine the price–volume relationship in the bitcoin market to validate near-stock properties of bitcoin. Design/methodology/approach: Daily data of bitcoin returns, returns volatility and trading volume (TV) are utilized for the period August 17, 2010–April 16, 2017. Linear and non-linear causality tests are employed to examine price–volume relationship in the bitcoin market. Findings: The linear causality analysis indicates that the bitcoin TV cannot be used to predict return; however, the reverse causality is significant. In contrast, the non-linear causality analysis shows that there are non-linear feedbacks between the bitcoin TV and returns. The bitcoin TV, which represents new information, leads to price changes, and large positive price changes lead to increased trading activity. Similarly, in recent periods (post-break period), the results of the non-linear causality test show a unidirectional causality from TV to the volatility of returns. Research limitations/implications: This study uses the average index value of major bitcoin exchanges. But further research on this relationship using data from different bitcoin exchanges may provide further insights into the price–volume relationship of bitcoin and its near-stock properties. Practical implications: These findings from the non-linear causality analysis, therefore, suggest that investors cannot simply base their decisions on the linear dynamics of the bitcoin market. This is because new information in terms of the TV is neither linearly related to the price nor it is a one-to-one kind of relationship as most investors commonly understand it to be. Rather, investors’ decisions should be based on non-linear models, in general, and the best-fitting non-linear model, in particular. Originality/value: The study examines bitcoin’s near-stock properties in a price–volume relationship framework with the help of both linear and non-linear causality tests, which to the best of the authors’ knowledge remains unexplored. © 2019, Emerald Publishing Limited.

International Journal of Managerial Finance

Is bitcoin a near stock? Linear and non-linear causal evidence from a price–volume relationship

Purpose: The purpose of this paper is to assess the dynamic impact of financial inclusion on economic growth for a large number of developed and developing countries. Design/methodology/approach: This study uses some panel data models such as country-fixed effect, random effect and time fixed effect regressions, panel cointegration, and panel causality tests to examine the linkage between financial inclusion and economic growth. Panel cointegration is being used to test the long run association between financial inclusion and economic growth, whereas panel causality test is used to find the direction of causality between financial inclusion and economic growth. The data on financial inclusion are taken from Sarma (2012) for the period 2004-2010. Findings: The empirical findings reveal that there is a positive and long run relationship between financial inclusion and economic growth across 31 countries in the world. Further, panel causality test shows a bi-directional causality between financial inclusion and economic growth Thus, the study confirms that financial inclusion is one of the main drivers of economic growth. Research limitations/implications: This study has two limitations. First, this study considers only banking institutions in the analysis. Second, the period tested for the long run relationship is not long enough. Practical implications: This study empirically measures the quantitative impact of financial inclusion policies pursued across the world. The study also suggests that policies emphasizing financial sector reforms in general and promoting financial inclusion in particular shall result in higher economic growth in the long run. Originality/value: This study attempts to assess the long run relationship between financial inclusion and economic growth with the help of a multidimensional index of financial inclusion. Therefore, this can be a valuable contribution to the banks and policymakers. © 2018, Emerald Publishing Limited.

Journal of Financial Economic Policy

Financial inclusion and economic growth linkage: some cross country evidence

This article examines the sectoral impact of disinflationary monetary policy by calculating the sacrifice ratios for several Organisation for Economic Co-operation and Development (OECD) and non-OECD countries. Sacrifice ratios calculated through the episode method reveal that disinflationary monetary policy has a differential impact across three sectors in both OECD and non-OECD countries. Of the three sectors, the industry and service sectors show significant output loss due to a tight monetary policy in OECD and non-OECD countries. But the agricultural sector shows a differential impact of disinflation policy: It shows a negative sacrifice ratio in OECD countries indicating that output growth is insignificantly affected by a tight monetary policy while non-OECD countries yield positive sacrifice ratios, suggesting that the output loss is significant. Further, it is observed that sacrifice ratios calculated from aggregate data are different from ratios calculated from sectoral data. JEL Classification: E52, E58, C14, O50. © 2018, © 2018 National Council of Applied Economic Research.

Margin

Can a Disinflationary Policy Have a Differential Impact on Sectoral Output? A Look at Sacrifice Ratios in OECD and Non-OECD Countries

This paper attempts a sectoral estimation of sacrifice ratios for India. Two Structural VAR models are estimated using quarterly data for the period 1997–98 Q1 to 2016–17 Q1. The empirical findings suggest that the real cost of disinflation policy is not negligible in India. The estimate of sacrifice ratios in terms of real GDP range from 0.16 to 0.17 depending upon the model employed. The calculation of sectoral sacrifice ratios show that all the three sectors are affected negatively and the largest impact is found in the manufacturing sector followed by the other two sectors, i.e., agriculture sector and service sector. The sacrifice ratio in the manufacturing sector is found to be 1.10 and 0.72 indicating huge negative impact of tight monetary policy. Similarly, for the agriculture sector the sacrifice ratios are 0.40 and the service sector shows sacrifice ratios of 0.36 and 0.37 respectively for different models. Further, from 10-year rolling estimation, we find that sacrifice ratios are time varying. The sacrifice ratio is declining in the last few quarters at the aggregate and sectoral levels indicating that disinflation could be less costly in recent times. However, the high disinflation cost experienced prior to the year 2015 can’t be neglected. So, it is important to take caution while interpreting the results of disinflation cost in India. © 2017, The Indian Econometric Society.