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Revisiting the Growth-Inflation Nexus: A Wavelet Analysis

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  • Saumitra N Bhaduri

    (Madras School of Economics)

Abstract

Motivated by the concern that the recent surge in inflation could retard growth, the paper revisits the nexus between inflation and growth from the perspective of an emerging economy, India. Examining this relationship using a wavelet multi resolution analysis with varying time scale decomposition suggests a strong and persistent negative relationship between growth and inflation for a short time scale, while it is not significant for a longer time scale.

Suggested Citation

  • Saumitra N Bhaduri, 2013. "Revisiting the Growth-Inflation Nexus: A Wavelet Analysis," Working Papers 2013-077, Madras School of Economics,Chennai,India.
    • Handle: RePEc:mad:wpaper:2013-077
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    References listed on IDEAS

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    8. By Mohsin S. Khan & Abdelhak S. Senhadji, 2001. "Threshold Effects in the Relationship Between Inflation and Growth," IMF Staff Papers, Palgrave Macmillan, vol. 48(1), pages 1-1.
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    Cited by:

    1. Muhammad Azmat Hayat & Huma Ghulam & Maryam Batool & Muhammad Zahid Naeem & Abdullah Ejaz & Cristi Spulbar & Ramona Birau, 2021. "Investigating the Causal Linkages among Inflation, Interest Rate, and Economic Growth in Pakistan under the Influence of COVID-19 Pandemic: A Wavelet Transformation Approach," JRFM, MDPI, vol. 14(6), pages 1-22, June.

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    More about this item

    Keywords

    Inflation; Decomposition; Wavelet Analysis;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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