Economic growth and structural break in India: Testing unit root hypothesis

This paper carries out some tests concerning data generating process of National Accounts time series to find out the role of economic reforms as introduced in India in the early1990s on economic growth of the country. Using the procedure described in Andrews and Ploberger (1994), we find that the single break in economic growth occurred in 1979, a long period before the introduction of economic reforms in the country and hence no perceptible impact of liberalisation on economic growth is observed.. Although high growth phase in the economy started since the 1980s, the process of high growth is not a consequence of resource allocation from low productivity sector to high productivity sector.