Dr. Purva Khera (IMF) will be presenting a seminar on Wednesday, 5th April 2017, at 4:30 P.M. in Seminar Hall 1.
Title: Prioritizing and Sequencing Structural Reforms and Coping with Adjustment Costs in India
Abstract: Based on a small-open economy DSGE model, this study examines long-term gains and adjustment costs across several deregulation reform scenarios in the labor and product markets and the role for demand management policies in supporting adjustment in India. Given India’s large informal sector, prioritizing labor market reforms that lead to formal sector job creation maximizes long-run gains and results in lower short-term adjustment costs compared to other reform scenarios. In general, supportive monetary and fiscal policies help bring forward long-run gains. At the same time, deregulation makes demand management policies more effective.