No abstract

This study examines the dynamic interrelationships among infrastructure, trade openness, foreign direct investments (FDI), economic growth, fixed capital formation, labour and inflation rate in the context of India for the period 1970 to 2018 through the application of Toda–Yamamoto (TY) causality test and the auto-regressive distributed lag (ARDL) bounds testing approach to cointegration to offer policy implications of the effectiveness of these important macroeconomic determinants in the short and long-run. This article developed two composite indices, namely, infrastructure development index (INFI) and trade openness index (TOI) and used to see the effectiveness of infrastructure indicators and trade openness on economic growth along with other variables of interest. Results suggest a strong causal short and long run interrelationship among infrastructure, FDIs, trade openness and economic growth during 1970–2018. In the long run, a bi-directional relationship exists between INFI and GDP, suggesting that India should expedite construction of adequate and expanded infrastructure facilities in the economy and among others things, frame its policy in a more liberalised manner for various sectors including infrastructure with a view to attracting more FDI inflows and making more openness to trade and globalisation within the environment of ease of doing business that would help to sustain higher economic growth for long period, accomplishing the goal of US$5 trillion economy by 2024–25. JEL Classification:H54, O1, H4, O4, P33, L9, C32

The study examines the empirical relationship between education expenditure, higher education and economic growth in the context of India using time series econometric analysis for the time period 1971-2015 based on Vector Autoregression (VAR) model and Johansen’s Cointegration procedure. The time series data were verified for the stationary properties by using Augmented Dickey Fuller and Phillips-Perron test techniques which showed the variables to be integrated of order one I(1). The Johansen co integration of trace and maximum Eigen value tests indicated the presence of one co-integrating relationship among the variables, that is, the existence of long run relationship among the variables under investigation. The Granger causality test results indicated a unidirectional causality that runs from government expenditure on education to economic growth and also the existence of unidirectional causality between higher education and economic growth that run from economic growth to higher education. The reverse causality did not hold in either cases. The error-correction mechanism gives evidence for the short-run dynamics. Impulse Response Function showed a sharp drop initially of GDP and then positive response of GDP to shock in education expenditure and higher education that appeal for productive investment in research and development and training with proper facilities and establishment of more educational institutions, particularly higher education institutions that will lead to higher economic growth of India.