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The Long-run Determinants of Indian Government Bond Yields

Tanweer Akram Anupam Das

Levy Economics Institute ,WORKING PAPER NO. 881, January 2017

This paper investigates the long-term determinants of Indian government bonds’ (IGB) nominal yields. It examines whether John Maynard Keynes’s supposition that short-term interest rates are the key driver of long-term government bond yields holds over the long-run horizon, after controlling for various key economic factors such as inflationary pressure and measures of economic activity. It also appraises whether the government finance variable—the ratio of government debt to nominal income—has an adverse effect on government bond yields over a long-run horizon. The models estimated here show that in India, short-term interest rates are the key driver of long-term government bond yields over the long run. However, the ratio of government debt and nominal income does not have any discernible adverse effect on yields over a long-run horizon. These findings will help policymakers in India (and elsewhere) to use information on the current trend in short-term interest rates, the federal fiscal balance, and other key macro variables to form their long-term outlook on IGB yields, and to understand the implications of the government’s fiscal stance on the government bond market.

URL: http://www.levyinstitute.org/publications/the-long-run-determinants-of-indian-government-bond-yields

Courtesy: Levy Institute

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Transfer of Economic Power in Corporate Calcutta, 1950–1970

  • Tirthankar Roy
  • Business History Review, Volume 91 – Issue 1 – Spring 2017
  • Between 1950 and 1970, the ownership of some of the largest business conglomerates in India changed from British to Indian hands. Almost without exception, the firms formerly under the management of British conglomerates saw bankruptcy, nationalization, relative decline in corporate ranking, and on rare occasions, reinvention of identity. In Indian business history scholarship, this episode is underresearched, even though hypotheses on the transfer-cum-decline exist. Combining a new source, legal documents, with conventional ones, this article revisits the episode and suggests revisions to current hypotheses.
  • URL: https://www.cambridge.org/core/journals/business-history-review/issue/2AE2E96C3F9FDAF40E9BC18B497C327C
  • Courtesy: Cambridge journals