Infrastructure and Labour Productivity: Panel Co-Integration and DOLS Evidence from the Indian Manufacturing Sector

摘要: Using data on the Indian manufacturing sector, which cover years 1994 to 2006, study assesses labour productivity elasticity with respect public infrastructure. Since earlier studies have merely examined effect either total factor (TFP) growth of sector or national income country and widely neglected direct effects present attempts fill this gap. Second, tests panel variables for unit roots show that they exhibit root process. This is a highly significant finding because most investigators applied Ordinary Least Square (OLS) Generalised (GLS) non-stationary (panel) variables, thereby generating spurious results. Finally, in contrast previous studies, article utilizes methodologically sound Dynamic OLS (DOLS) procedure generate consistent estimates relevant co-integrated production function. The results our analysis suggest infrastructure does affect labor India. Its positive, nonetheless very small. found be more sensitive private capital than capital.