Wednesday, July 1, 2009

Examining the Decoupling Hypothesis for India

NIPFP Working Paper 61

Shruthi Jayaram, Ila Patnaik, Ajay Shah
June 2009

This paper examines the decoupling hypothesis for India. We analyse business cycle synchronisation between India and a set of industrial economies, particularly the United States, over the period 1992 to 2008. The evidence suggests that the Indian business cycle exhibits increasing co-movement with business cycles in industrial economies over this period. Indian business cycle synchronisation is stronger with industrial countries as a whole as opposed to the co-movement found with the US.