Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/173481
Authors: 
Chakraborty, Pinaki
Year of Publication: 
2016
Series/Report no.: 
Working Paper, Levy Economics Institute 872
Abstract: 
The primary objective of rule-based fiscal legislation at the subnational level in India is to achieve debt sustainability by placing a ceiling on borrowing and the use of borrowed resources for public capital investment by phasing out deficits in the budget revenue account. This paper examines whether the application of fiscal rules has contributed to an increase in fiscal space for public capital investment spending in major Indian states. Our analysis shows that, controlling for other factors, there is a negative relationship between fiscal rules and public capital investment spending at the state level under the rule-based fiscal regime.
Subjects: 
Fiscal Deficit
Revenue Deficit
Fiscal Rule
JEL: 
H00
H6
Document Type: 
Working Paper

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