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Inflation, uncertainty and monetary policy in India: a regime-switching analysis

Publication date

  • अक्ट, 2015
  • Details

    Economics Bulletin, 35(4):2213-19

    Authors

    Sudhanshu Kumar

    Abstract

    Based on the characteristics of the inflation data for India, the paper first identifies the possible number of significantly different regimes using Kernel density estimates; and then it estimates a Markov-switching model using the Maximum Likelihood Estimation. Estimated results suggest that high inflation uncertainty in India has not only been a feature of very high levels of inflation but is also associated with the low levels.
     
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