Covid-19, macroeconomic policies, and analysis of the inflation-unemployment dynamics in india
COVID-19; Demand; Fiscal policy; India; Inflation; Monetary Policy; Shocks; Supply; Unemployment
Indian economy could largely withstand the adversities of 2008 recession, the signs of a downturn were clearer by 2017 following the arrival of twin policies, Demonetization as well as the Goods and Services Tax. The COVID-19 pandemic has deepened the crisis leading to a significant reduction in production and total expenditure. Although India has resorted to a combination of conventional policies monetary as well as fiscal injections to face the economic crisis, it has had serious negative consequences on production and employment. We investigate the nature of relationship between inflation and unemployment during the recession and the pandemic times using the non-linear regression analysis. The results reveal that the recessionary phase has given way to a stagflationary situation owing to inflation persistence in the short run. We suggest the usefulness of a more comprehensive term structure strat?gy to deal with the adverse supply shocks and policy failures. Indian Institute of Finance.
Karakunnel J.J.; Victor V.; Athan S.L.A.; Fekete-Farkas M.
Finance India, Vol-38, No. 2, pp. 339-356.
Karakunnel J.J., CHRIST (Deemed-to-be-University), The Department of Economics, Bhavani Nagar, SG Palya, Karnataka, Bangalore, 560029, India; Victor V., Indian Institute of Technology (IIT) Roorkee, Department of Humanities and Socieal Science, Roorkee, 247667, India; Athan S.L.A., CHRIST (Deemed-to-be-University), The Department of Economics, Bhavani Nagar, SG Palya, Karnataka, Bangalore, 560029, India; Fekete-Farkas M., Hungarian University of Agricultural and Life Sciences, Faculty of Economics and Social Science, Per Koly str. 1, Glo, 2100, Hungary