Progress in Applied Econometrics in India: A Selective Review

Abstract

During the past 25 years or so, econometrics has grown at a very rapid pace, and has come to play a major role in the development of the economics discipline. Palgrave's Handbook of Econometrics in two volumes: edited by Mills and patters on: volume I-Econometric Theory (2006) and Volume 2: Applied Econometrics (2009), each volume with 10 parts and 29 chapters bears testimony to the diversified growth of both econometric theory and applied econometrics. The symposium on Recent Ideas in Econometrics published in the Journal of Economic Perspectives, Spring 2017 issue covers 6 themes, one in Econometric Theory, 4 in Applied Econometrics, and one on undergraduate econometrics instruction. Applied Econometrics has received much more attention than Econometric Theory in the twenty-first century. During the past five decades, many eminent economists have won the Nobel Prize in Economics for their seminal contributions in Applied Econometrics, beginning with Frisch and Tinbergen in 1969. Several institutions in Higher Education and Research in India have contributed much to the development of econometrics in India. The Econometric Society of India (TIES) founded by Mahalanobis and C R Rao, five decades ago, and the Journal of Quantitative Economics (JQE) founded in 1983 deserve credit for the development of Applied Econometrics in India. This essay attempts a selective review of Econometric Practice in India in the twenty-first century in the different fields of microeconometrics and macroeconometrics. The increased availability of a variety of databases and sophisticated econometric software have greatly facilitated applied econometric research in the country. However, a large proportion of colleges in India lack instructional and research resources for Applied Econometrics.