Central banks globally prioritize keeping inflation low and stable around a predetermined target because inflation volatility creates significant economic disruptions for the real economy, particularly affecting the population with fixed or limited income. To this end, the present article analyses the inflation trajectory in India since 1951-52. The descriptive analysis indicates that a fall in inflation and its volatility has strengthened the credibility of the monetary policy from a credit-targeting to a rule-based inflation-targeting framework. The study also examines the impact of potential macroeconomic determinants such as fiscal policy, monetary policy, output gap and trade openness on Consumer Price Index (CPI) and Wholesale Price Index (WPI) based inflation in the Indian context in an open economy framework for the period 1996-97Q1-2023-24Q4. Using the Brock–Dechert–Scheinkman (BDS) independence test, the study explicitly identified the non-linear nature of the determinants of inflation and applied the non-linear autoregressive distributed lag (NARDL) technique to evaluate their impact on inflation. The results reveal significant asymmetric effects of fiscal deficit on inflation with an inflationary impact on CPI inflation but dis-inflationary impact on WPI inflation. Trade openness exhibits an anti-inflationary response to CPI inflation and a positive response on WPI inflation. Further, a price puzzle is observed in the case of CPI. The findings emphasize the importance of effective fiscal consolidation and suggest the index-sensitive impacts of determinants of inflation in India. Wald tests and dynamic multipliers provide robustness to the results. JEL Codes: C22, E31, E42, E52, E58

Monetary policy approaches in India have changed from the simple monetary targeting frameworks in the mid-1980s to the multiple-indicator approach in the late 1990s and to the current flexible inflation targeting framework. The study aims to investigate the relationships among the macroeconomic variables money supply, real income, price level and interest rate for the period 1998-2014 in the case of India, a period when India adopted the multiple-indicator approach as its monetary policy strategy. The study uses the vector autoregression (VAR) model to examine the dynamic relationships among the variables. The Granger causality test via the VAR framework suggests that four pairs of causality exist; in particular, bidirectional causality exists between money supply and price level. Interest rate Granger-causes both real income and price level, and money supply Granger-causes the rate of interest. However, the study could not find any causal relationship between real income and money supply in either direction. The findings that money supply causes the interest rate and the interest rate causes real output are in line with the Keynesian theory, which argues that money supply affects output through the nominal interest rate. Finally, the results also support the arguments made in favour of a policy move from the multiple-indicator approach to the inflation targeting framework in India.

Purpose The main objective of the present study is to figure out the effect of agricultural development on environmental pollution in the Indian context over the period 1970 to 2018. The study also tests the applicability of pollution haven hypothesis. Design/methodology/approach To begin with, the authors test the stationarity of the variables by using the DF-GLS and KPSS tests. To examine the relationship between agricultural development and carbon emissions, the study applies nonlinear autoregressive distributed lag cointegration test developed by Shin et al. (2014). The study also applies Wald test to test the asymmetry between agriculture and environmental pollution. Findings The findings of this study indicate that agricultural development in India is good for carbon mitigation in the long run whereas energy consumption degrades the environment. The findings document the existence of an asymmetric association between agricultural development and environmental pollution. Furthermore, the results did not find any presence of pollution haven hypothesis for India. Originality/value This is the only empirical work that assesses the contribution of agricultural sector to carbon mitigation in the Indian context. The novelty of the study is further ensured by the very nature that it is the first study that examines the effect of agricultural sector on environment in an asymmetric configuration.

The present study aims at examining the inflation dynamics in Indian context with a particular focus on its determinants from 1991–1992Q1 to 2017–2018Q4. The purpose of this study is to investigate the role of monetary, fiscal, structural and external variables in explaining inflationary tendencies in India in the post economic reform period. To identify the determinants fuelling the inflationary tendencies, the study employs ARDL bounds testing procedure followed by the VECM Granger causality test. The findings indicate that interest rate shock and output growth mitigates inflation while rupee depreciation, money supply generate inflationary pressures in the economy. Moreover, fiscal deficit has inflationary impact only in the short run. The positive link between inflation and openness refutes the applicability of Romer’s hypothesis in the Indian context. VECM based Granger causality indicates that money supply and interest rate causes both output and inflation, which suggests monetary policy in India has an important role to play in the process of economic growth and price stability. JEL Classification: E3, E4, F6, E620

The call for inclusive growth has been unanimously declared by policymakers across the world. With India’s rapid economic growth rate, Indian policymakers also set its economy on the track of inclusive growth while formulating the 11th Five Year Plan. Despite, India’s fast-growing and vibrant economy, it fails poorly in Human Development Index ranked 131 in 2016. An unfortunate aspect of the current phase of high growth of the Indian economy has been its ‘non-inclusive’ nature. The distribution of income has been highly iniquitous. The richest 1% in India cornered 73% of the wealth generated in 2017, presenting a worrying picture of rising income inequality. In this regard, the study attempts to identify the determinants of inclusive growth in India by using annual data from 1981 to 2015. The study employs the autoregressive distributed lag (ARDL) model and the error correction method (ECM) to investigate the long-run and short-run relationship between inclusive growth and its determinants. The bounds test findings confirm the cointegrating relationship among variables. The ARDL estimates suggest that growth in initial income, government expenditure, human development, investment and financial development fosters inclusive growth; while inflation and population growth dampens it. The results also imply that increasing trade openness and foreign direct investment would not be beneficial for India in terms of growth inclusiveness. Based on these findings, the study recommends that the Government of India should take appropriate steps to increase per capita income and social spending with particular attention to macroeconomic stability while they work at improving the quality of population in order to achieve sustainable and robust inclusive growth.JEL Codes: Q4, F1, H7, D31, O43

Tourism has become the world’s third-largest export industry after fuels and chemicals, and ahead of food and automotive products. From last few years, there has been a great surge in international tourism, culminates to 7% share of World’s total exports in 2016. To this end, the study attempts to examine the relationship between inbound tourism, financial development and economic growth by using the panel data over the period 1995–2015 for five BRICS (Brazil, Russia, India, China and South Africa) countries. The results of panel ARDL cointegration test indicate that tourism, financial development and economic growth are cointegrated in the long run. Further, the Granger causality analysis demonstrates that the causality between inbound tourism and economic growth is bi-directional, thus validates the ‘feedback-hypothesis’ in BRICS countries. The study suggests that BRICS countries should promote favorable tourism policies to push up the economic growth and in turn economic growth will positively contribute to international tourism.

The present study empirically examines the factors accounting for inflation in India in an open economy framework by utilizing the bounds testing approach to cointegration for the 2006: Q3-2019: Q4 period. The findings reveal the existence of a long-run relationship with the household survey-based inflation expectation, real output, narrow money aggregate and interest rate as important determinants of inflation. The study concludes that inflation is well explained by a combination of structural and monetary factors. Notably, the significance of inflation expectation as an important explanatory variable corroborates the utilization of inflation forecast by the RBI as an intermediate target in the flexible inflation targeting framework. In this backdrop, it is imperative for RBI to conduct a high frequency inflation expectations survey of households to account for frequent information updation on the part of certain groups of households.

PurposeThe genesis of Environmental Kuznets curve (EKC) of “grow now clean later” has led to a substantial deterioration of local as well as the global environment. India has not been spared of this malaise and accounts for the third-largest carbon dioxide emitter in the world. Thus, the present study revisits the curvilinear relationship between economic growth and environmental pollution in case of India over the period of 1971-2014.Design/methodology/approachDickey–Fuller generalised least square (DF-GLS) test developed by Elliottet al.is used to ensure that none of the variables is I(2). The study applies the autoregressive distributed lag (ARDL) bounds estimation technique to test for the existence of cointegration among variables and estimate long-run and short-run parameters. The study also applies the Bai–Perron structural break test with unknown break date to determine the threshold point. The study further uses the vector error correction model (VECM) Granger causality test to check the direction of causality between variables.FindingsThe ARDL bounds estimation technique confirms the cointegration among variables. The long-run coefficients of energy consumption, economic growth and financial development are found to have an adverse impact on environmental quality. The results also validate the existence of conventional EKC hypothesis. Bai–Perron structural break test, along witht-test and scatter graph, shows that inverted U-shaped relationship between environmental pollution and economic growth holds true. The VECM-based causality results support “growth hypothesis” both in the long run and short run.Research limitations/implicationsThis study refrained from considering a variety of variables, as the main intention of the study is to investigate whether any threshold or turnaround point exists for India. The future studies should consider a new set of variables (e.g. population, corruption index, social indicators, political scenario, energy research and development expenditures, foreign capital inflows, public investment towards alternate energy exploration, etc.) in the estimation of EKC hypothesis.Practical implicationsThe results validate the existence of conventional EKC hypothesis. Thereby the study argues that instead of being a threat to environmental quality, economic growth is observed to generate a sustainable environment to live in. Further, bi-directional causality is found between carbon emissions and economic growth. Thus, any effort to mitigate CO2or environment conservation policy will impede economic growth. Consequently, controlling primary energy consumption and supply and replacing it with renewable and clean energy could be desirable for climate change mitigation.Originality/valueThe data set has been refined so that the EKC estimation issues raised by Stern (2004) are addressed. In particular, statistical properties of the data set such as serial correlation, presence of a stochastic or deterministic trend, has been adequately taken care of to remove any spurious correlation. Finally, various control variables have been included to provide consideration to issues of model adequacy, such as the possibility of omitted variables bias. To the authors’ best knowledge, there is no India-specific study which has taken care of data-related issues, as suggested by Stern, in the estimation of a curvilinear relationship between environmental degradation and economic growth in India. Further, this is the first study which has used Bai–Perron structural break test with unknown break date to identify the threshold point while estimating EKC in India.

After financial crisis 1924, the corporate world was forced to restructure their relationship with stakeholders. Stakeholders contested for greater accountability and transparency from corporate management. The Corporate world can’t succeed without taking cognizance of their immediate society. European Commission (2001) defined “CSR as a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on the voluntary basis”. CSR has broadened the domain of corporate sector from stockholders to stakeholder by assigning responsibility towards all those institutions which are affected by the company. Despite a substantial research on CSR, it still lacks conceptual clarity. Different scholars regressed to come up with an inclusive definition, which reflects basic CSR character. We have looked for a definition and basically, there isn’t one (Jackson & Hawker, 2001). The problem exists due to the social construction of definition which fickles across time and space. The comprehensive definition was proposed in 1983, by AB Carroll “corporate social responsibility involves the conduct of a business so that it is economically profitable, law-abiding, ethical and socially supportive”. Thus, CSR is a philosophy which defines the company-stakeholders relationship.The CSR is ever more on the agenda of business organization, due to its ability to enhance the competitiveness of a firm. This has motivated researchers to investigate what affect CSR exerts on bottom-line of the business. In this perspective, prior work has presented divergent results. The dominant perspective believes that CSR provides a competitive edge, which finally enhances the financial strength of the business (Margolis et al., 2009). The underlying premise, which asserts that CSR enhances financial performance, is the stakeholder theory (Freeman, 1984). The theory emphasis that the success of a company depends on the enduring relationship with stakeholders and managing them have become an essential tool for value creation (Hammann et al., 2009). The other perspective is negative relationship between two constructs. According to this line of thinking, it consumes the scares resources of company without any substantial return (Friedman, 1970). In other words, social action involves a cost which affects profit negatively. For instance, cost incurred in different CSR activities, for instance, charity, eco-friendly equipment, better working conditions, pollution control, will squeeze the profitability. As a blistering topic of debate, CSP - CFP investigated worldwide, but lacks insights from an Indian perspective. Further, developing countries became a great receptive of CSR idea, which have become a hub of CSR, makes it imperative to assess its financial implications. Thus, the motive is to explore the nature and the course of association shared between the CSR and financial performance by Indian commercial banks.Despite the plethora of research to exemplify the relationship between CSR and firm value, literature fails to provide conclusive evidence. Thus, this study provides some empirical evidence, which may help in explaining divergence in prior work. Using an improved and distinctive method, to verify the impact of CSR on both profitability and market returns in the Indian context. The study employed a panel data set of 28 Indian commercial banks for 10 years. Likewise, Size, risk, capital intensity and age were incorporated as control variables. The result shows CSR positively impacts profitability and stock returns. There by evincing that it pays to be socially responsible. It makes clear from the finding that CSR, as valuable and rear resource, can be exploited to create a competitive advantage for the firm The findings specifically validate the results of previous studies (e.g., Supriti Mishra, 2010; Cochran & Wood, 1984 Simpson & Kohers, 2002; Waddock & Graves, 1997). Therefore, social responsibility initiatives can be considered as strategy creating legitimacy, reputation, and competitive advantages. An ideal CSR towards all the essential stakeholders creates a fleet of satisfied stakeholders who bring effectiveness and cost reduction through different means that ultimately enhance firm performance. Satisfied workers compensate the firm through productivity gains and lessened employing and training costs, satisfied clients enhance item deals through repeated purchase behavior, satisfied investors lend capital at a less expensive rate diminishing cost of capital; satisfied community decreases the advertising cost, ecological stewardship prompts favorable circumstances, and better suppliers reduce quality certification costs. Similarly, when firms enhance CSR towards their stakeholders, consumers not only like, respect, or admire the firms but also identify with it. Such identification turns out to be solid and persisting (Sen and Bhattacharya, 2001) hence those customers become brand diplomats of the firm with enduring loyalty (Gillentine, 2006). All these activities will create a competitive advantage for the firm (Porter & Kramer, 2002). In summary, CSR can be linked with a number of bottom-line benefits.The results of this study have an important implication for strategic managers. First, considering the impact of CSR on firm’s performance, companies should give adequate concern to their social responsibilities. CSR should not be treated as an optional activity rather it should be integrated with long-term business strategy. When CSR is aptly integrated into the business operations, both social and financial target becomes easier and resulting in better financial performance. Therefore, managers of the companies that do not practice CSR must treat it as one of their core business functions for long-term business performance. Second, the financial base of CSR gives it a strategic position in the corporate world. Yielding positive results, CSR will be taken as voluntary initiative rather than taken under legislative compulsions. In fact, forcing business organization does not actually signify that they will respond and go beyond legislation requirements. Therefore the underlying premises of financial outcome will be useful in the long run, to move business organizations beyond legislative compliance.The results should be interpreted with certain limitations. First study does not consider the kind of CSR a firm takes. It is empirically affirmed, philanthropic and strategic CSR can have a different impact on financial performance. The collection of CSR into single score conceals its genuine effect. So future research, should consider the different kinds of CSR to establish a meaning full research. Second study focused on a particular industry, which could have done with more industries, as CSR vary across industries due to nature of their operations. Therefore future research should be conducted on the cross-section of industries.

High inflation is widely believed to hamper economic growth and is harmful to social justice, thereby lending credence to emergence of low and stable inflation as a key objective of economic policy. India witnesses a rise in inflation during 1970s and 1980s due to various demand and supply side factors. Since then inflation has always remained a debateable issue among researchers and policy makers regarding its causes and management. Thus, the Present study provides an empirical analysis of the factors accounting for inflation dynamics and examine the nature of longrun and shortrun relationship among the variables in India for the period 1970-2015. To this end, the study applies auto-regressive distributive lag (ARDL) bounds testing approach to cointegration and Vector Error Correction Model to determine the direction of causality between the variables. The bounds test results indicate that there is a meaningful longrun relationship among the variables when inflation is considered as dependent variable. We find that money supply, interest rate, exchange rate and real output has a significant impact on the inflationary process in India both in the shortrun and longrun. The error correction term is found to be negative and significant which reinforces the long run equilibrium relationship among the variables. The paper concludes that inflation in India is explained by a combination of structural and monetary factors and consequently, study comes out with some important policy implications.

The study examined the pattern of corporate social responsibility by top commercial banks in India as reflected in their respective company documents in the public domain. An empirical and analytical study was undertaken where by the corporate official websites of banks were analyzed for the time period of 5 years from 2011–2012 to 2015–2016. Data were then generated from such an analysis using qualitative document analysis. For this study, we used ‘number of sentences’ as the unit for measurement of CSR participation. Descriptive statistics, Pearson's correlation and conjoint analysis were used to analyze the data. The most preferred activities observed to be ‘education’, ‘environment’, ‘rural upliftment’, and ‘health’. The least preferred activities with respect to the banks were observed to be mostly ‘water& sanitation’, ‘disaster relief’, and ‘empowerment’.

Controlling inflation is one of the biggest challenge faced by macroeconomic policymakers in India. Present study is an attempt to identify the determinants of inflation and examine the nature of cointegration among the variables in India. Against this backdrop, the study utilized annual time series data from 1970 till 2015, and employed both the Autoregressive Distributed Lag Model (ARDL) and the Error Correction Method (ECM) to investigate the long-run and the short-run relationship among the variables. The ARDL bounds test results reveals the existence of longrun association among the variables when price is a dependent variable. Granger Causality based Error Correction Model also confirms both the longrun and shortrun causality running from all the explanatory variables towards price. Further, the coefficient of error correction term with negative sign remains statistically significant with approximately 65 percent speed of adjustment to restore the equilibrium in the long run, which shows the quick convergence. The outcomes of the impulse response functions (IRFs) test nearly support the findings of the present study. CUSUM and CUSUM-Q plots suggests the stability of coefficients estimated for both short run and long run model. Finally, some policy implications pertaining to the empirical findings are also discussed.

Oil has been a dominant source of energy especially in developing countries. It is believed that consumption of oil in developing countries, in general and India in particular, has been accelerated by economic growth and development. To this end, this article examines the causal nexus between economic growth and oil consumption in case of India, using autoregressive distributed lag model (ARDL) bounds testing approach. This study is based on annual time series data for the period 1971-2015. The result of bounds test reveals the co-movement of the variables under consideration, in the long run. Both the long-run and short-run coefficients of the ARDL representation hold good which indicates that consumption of oil spurs economic growth in India. The statistically significant error correction term (ECT) further suggests that the long run causality running from oil consumption to economic growth, in case of India. Wald statistics also found evidence of one sided short run causality from oil consumption to growth. Therefore, study supports the growth hypothesis; where the consumption of oil contributes to economic growth significantly. Consequently, it can be concluded that an energy policy, which reduces oil consumption puts a slight constraint on gross domestic product growth i.e., shortage of oil supply can obstruct economic growth.