Archive for October 11th, 2011

Rethinking economics of sovereign debt

October 11, 2011

Ken Rogoff gives this superb lecture on this topic of debt crisis and debt economics. He speaks at 3rd annual Martin Feldstein lecture hosted by NBER.

He says despite many years of GDepression, econs continue to debate its causes etc. Now there is some truce:

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India’s threshold inflation levels around 6%

October 11, 2011

Yesterday, RBI released  a series of papers on inflation.

I just read the second one Inflation Threshold in India: An Empirical Investigation by Deepak Mohanty, A B Chakraborty, Abhiman Das and Joice John.
The paper is quite good and explains the basics of threshold inflation and what is its level in India. They calculate the this threshold based on 3 approaches and comes around 4.0% – 5.5%. For inflation upto 5.5%, impact on growth is positive. Anything over it, it starts to impact growth.
They clarify that inflation threshold and inflation target are different concepts. We should have targets lower than thresholds given the lag effect of mon pol:
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Explaining the resilience of India’s services sector

October 11, 2011

Nice paper from Abhijit Das, Rashmi Banga, and Dinesh Kumar. Though it is focused on services sector in 2008-09 crisis period, it has broader lessons for India’s thriving services sector.

The paper points to two broad lessons:

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