GDP, railway freight, inflation & population density: An econometric quadrangular study in Indian context (1960–2009)

The main purpose of this study is to ascertain the existence of a relationship (if any) between GDP, Inflation, population density and freight carried by Indian railways. The paper explores the nexus between Indian GDP, Railway freight, inflation and population density, with a view of understanding the causality relationship in the backdrop of Indian economic growth over a period of fifty years (1960–2009) using cointegration and Granger causality test. Detection of stationarity in the series was carried out using the Augmented Dickey-Fuller test (ADF) and Phillips-Perron(PP) Unit root test and stationarity outcomes indicated GDP & Inflation data to be stationary and Population density & Railway Freight to be non stationary at 5% level of significance. The paper reveals unidirectional causality from GDP to Population density and also from GDP to railway freight, whereas bidirectional causality is found to exist between railway freight and population-density. Thus, these test findings confirm the existence of a positive relation between GDP and Indian railway freight for the period (1960–2009).