Does government revenue converge across Indian states? Evidence from club convergence

Akram, Vaseem and Rath, Badri Narayan (2021) Does government revenue converge across Indian states? Evidence from club convergence. Applied Economics Letters. pp. 1-5. ISSN 1350-4851 (In Press)

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While the bulk of the studies in India examine the convergence of per-capita income or expenditures, we investigate whether there is any evidence of convergence of government revenues and its various compositions by focusing a panel of 22 Indian states for the periods 1980–81 to 2014–15. To answer this question, the present study employs Phillips and Sul panel club convergence technique. The results find evidence of a single club convergence in the case of total revenues and revenues collected in the revenue account. Further, our results also reveal the presence of three-club convergence when we disaggregate the gross revenues into capital receipts and state-owned tax-revenue. From the policy perspective, it is important for the Central government to integrate all states in revenues collection through tax devolution formula and grants-in-aid.

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IITH Creators:
IITH CreatorsORCiD
Rath, Badri Narayan
Item Type: Article
Uncontrolled Keywords: capital receipts,club convergence,revenue receipts,state-owned tax-revenue Total revenues
Subjects: Social sciences > Political Science & Economics
Arts > Liberal arts
Divisions: Department of Liberal Arts
Depositing User: . LibTrainee 2021
Date Deposited: 30 Mar 2021 04:11
Last Modified: 30 Mar 2021 04:11
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