000			01653nam a22001577a 4500
999			_c517326 _d517326
008			210709b ||||| |||| 00| 0 eng d
100			_aSethi, Dinabandhu et al _926402
245			_aThreshold level of fiscal deficit: Revisiting FRBMA limit in Indian states
260			_aJournal of Social and Economic Development
300			_a 22(2), Dec, 2020: p.233-249
520			_aThis paper examines whether the fiscal deficit limit of 3% as prescribed by the FRBMA is justified keeping in mind the increasing spending requirement and economic growth of Indian states? The study uses a panel data framework of taking sixteen non-special category states of India for the period over 2001–2002 to 2016–2017. This paper is the first of its kind that uses a threshold regression model due to Khan and Senhadji (IMF Staff Papers 48(1):1–21, 2001) to find the threshold level of fiscal deficit. The empirical findings show that the threshold level of fiscal deficit in sixteen states taken together is found to be 3%, which is in the line of prescribed limit of FRBM act. But at disaggregated level, it is observed that in middle- and low-income states the threshold level of fiscal deficit is 3.9% and 3.5%, respectively. This suggests that states can go for some additional percent of fiscal deficit above the limit prescribed by FRBMA. Therefore, the fiscal deficit limit of 3% needs to be revisited to give more fiscal room to the Indian states. – Reproduced
650			_aFiscal deficit, Threshold regression, FRBM rule, Economic growth _924984
773			_aJournal of Social and Economic Development
906			_aFISCAL DEFICIT
942			_cAR