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An Enquiry in to the Trickling down effect of key Macro Economic Variables on GDP Growth

Dr Thushara George

 Assistant Professor Department of Economics, St Teresa’s College Ernakulam Kerala, India, PIN 682011

 Received 20th April 2018, Accepted 10th May 2018

Abstract:

The development of an economy is measured through the changes in its GDP.A lot of thought has gone into what policies should be adopted in order to increase the growth of GDP .We have selected this area for study so as to equip ourselves with the knowledge of the causal relationship of GDP with other economic variables. The variables used in the study are GDP, GOVT FINAL CONSUMPTION, PVT FINAL CONSUMPTION, CHANGE IN STOCK, EXPORT and IMPORT .Vector error correction model was applied to understand the nature of relationship with these variables. Our model results point on the association between variables both long and short runs. The study found that there is bi-directional causality and positive correlation between GDP and export growth and vice versa for India.

 Keywords: Macro Economic- Variables- GDP –  VECM Model

Please cite this article as:

Dr Thushara George (2018) An Enquiry in to the Trickling down effect of key Macro Economic Variables on GDP Growth. International Journal of Recent Research and Applied Studies, 5- 5(5), 18-26