The nature of the financial turbulence that happened recently in US and Europe, why it happened, where it happened, and the implications for central banks. Some of the forces that led up to and characterized the recent spate of events, the specific responses of central banks and some challenges...

The paper attempts to analyse the emerging contours of regulation of financial institutions with an emphasis on the emerging challenges and dynamics. [Paper prepared for Financial Stability Review of Bank of France].

A brief overview is provided about India’s long-term growth performance. Then an attempt is made to set out the conditions for successful innovations. To assess the role of innovations in the Indian economy, the estimated contributions of productivity gains to real GDP growth is...

We first build a fair wage model in which effort varies over the business cycle. This mechanism decreases the need for other sources of sluggishness to explain the observed high inflation persistence. Second, we confront empirically our fair wage model with a New Keynesian model based on the...

Presentation shows the global financial crisis, the difference between US, Europe and India, RBI’s policy response and impact, lessons from the crisis, medium-term issues and challenges. [Speech delivered at London Business School].

We consider a model with frictional unemployment and staggered wage bargaining where hours worked are negotiated every period. The workers’ bargaining power in the hours negotiation affects both unemployment volatility and inflation persistence. The closer to zero this parameter, (i) the more...

In monetary policy strategies geared towards maintaining price stability conditional and unconditional forecasts of inflation and output play an important role. This paper illustrates how modern sticky-price dynamic stochastic general equilibrium models, estimated using Bayesian techniques, can...

This paper focuses on the role of fiscal and monetary policies in the evolution of the Indian economy over the years, with particular attention being given to the reforms undertaken in these policies since the early 1990s. [Sixth Asian Economic Policy Review Conference, Tokyo].

An overview of domestic and global macroeconomic developments [Valedictory address at the High Powered Macroeconomic Workshop organised by the State Bank of India].

This paper develops and estimates a stochastic dynamic general equilibrium (SDGE) model with sticky prices and wages for the euro area. The model incorporates various other features such as habit formation, costs of adjustment in capital accumulation and variable capacity utilisation. It is...