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Does Government Intervention in Credit Deployment Cause Inclusive Growth? – An Evidence from Indian Banking

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  • Swamy, Vighneswara

Abstract

Access to finance by the poor is a sine qua non for poverty reduction through economic development thereby driving inclusive growth which can further lead to sustainable growth. This study using adequate data covering pre and postliberalisation period from 1974-75 to 2007-08 in the Indian context and employing Multiple Regression (OLS) Analysis has established that there is a strong need to strengthen policy approach for financing the priority sector as it has had a positive impact towards attaining inclusive growth. In view of the strong relationship between priority sector lending and inclusive growth, it is imperative on the policy makers in general and the governments in particular to make efforts to induce the banks and financial institutions in accelerating priority sector lending beyond the stipulations laid down.

Suggested Citation

  • Swamy, Vighneswara, 2011. "Does Government Intervention in Credit Deployment Cause Inclusive Growth? – An Evidence from Indian Banking," MPRA Paper 48100, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:48100
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    References listed on IDEAS

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    More about this item

    Keywords

    Financial Markets and Macro economy; Credit; Government Policy and Regulation; Economic Development; Institutions and Growth;
    All these keywords.

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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