Title: Dimensions of globalisation and economic growth of India: exploring causal linkages

Authors: Balraj Verma; Amit Srivastava

Addresses: Department of Humanities and Social Sciences, Jaypee University of Information Technology, Waknaghat, Solan (HP), India ' Department of Humanities and Social Sciences, Jaypee University of Information Technology, Waknaghat, Solan (HP), India

Abstract: After experiencing more than two decades of the era of globalisation, it is pertinent to test the influence of the globalisation dimensions (namely - trade, financial, cultural, interpersonal, informational and political) on the Indian economic growth. The present study not only tests but also tries to explore the causal linkages between dimensions of globalisation and the economic growth in context to India. The study applies Johansen cointegration test and VAR/VECM for finding out the cointegration and causal linkages. To ascertain the robustness, the study also performs residual tests for normality, serial correlation and heteroskedasticity. The result shows the long-run convergence between the globalisation's dimensions and India's economic growth. All the six dimensions of globalisation showed long-run convergence and short-run multivariate causality with Indian economic growth. Financial globalisation showed bi-directional causality with GDP. Also, the study established a unidirectional causal effect of GDP towards trade, information and interpersonal globalisation in the long-run.

Keywords: globalisation; economic growth; KOF Globalization Index; cointegration; vector autoregressive; VAR; vector error correction model; VECM; Granger causality; stationarity; India.

DOI: 10.1504/IJEPEE.2022.121345

International Journal of Economic Policy in Emerging Economies, 2022 Vol.15 No.2/3/4, pp.197 - 213

Received: 04 Dec 2019
Accepted: 10 Aug 2020
Published online: 07 Mar 2022 *

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