Convergence In Public Expenditure And Public Revenue Across Indian States: Implications For Sustainable Economic Growth

Convergence of public expenditure, public revenue and also per capitaincome has been examined for fourteen non-special category major states ofIndia during the post-reforms period 1991-92 – 2009-10. The empiricalverification of the convergence hypothesis has been accomplished withabsolute b-convergence, s-convergence and spatial convergence with SpatialLag Models and Spatial Cross-Regressive Models. Though in certain cases,the sign of the convergence coefficient exhibits the presence of convergence,it could not be defended on ground of its statistical significance. The absenceof convergence in public expenditure and public revenue is seen to have beena strong deterrent to the achievement of sustainable economic growth of theIndian economy