An Analysis of Major Determinants of Food Inflation in India
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Date
2014
Authors
Journal Title
Journal ISSN
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Publisher
Indian Society for Education and Environment
Abstract
The study has exclusively analyzed the major determinants of food inflation
in India by using the monthly data from January 2006 to December 2013.
Using Johansen’s cointegration technique, it was shown that in long run,
all major determinants of food inflation such as money supply, interest rate,
exchange rate, crude oil and rainfall except world food prices affect food
inflation significantly. The Error Correction Model was also used to
comprehend the short run behavior of food inflation and its determinants.
The error correction term turned out to be significant statistically which
further confirmed the long run causality as well as the speed of convergence
towards long run equilibrium. In short-run, only world food and crude oil
prices affect the food inflation.
Description
Keywords
Cointegration, food inflation, inflationary pressure
Citation
4. Ahmed, M. and N. Singla (2014). An Analysis of Major Determinants of Food Inflation in India. Indian Journal of Economics and Development, 10(3): 275-282.