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Rural-Urban Migration and Economic Growth in India: An ARDL Bounds Testing and Causality Approach

G. Manoj Kumar, M. N. Megeri

Abstract



The study focuses on dynamic quantitative relationship between Rural-Urban Migration and Economic Growth in India. The data has been incorporated from Census of India and Economic Survey for the period of 1951-2011. The annual data for the variable is interpolated from census decadal data by using Newton’s forward difference method. The study used Augmented Dickey-Fuller(ADF) test, Co-integration; Auto Regressive Distributed Lag bounds testing approach for analyzing the long run relationship whereas Error Correction Mechanism (ECM) was applied for analyzing the short run link and Granger Causality to find dependencies between the two variables. The results suggest that there exist a positive stable relationship between them and economic growth appear to be a granger-cause for rural urban migration in India, while the opposite not holds good for all the lag periods. Thus the level of economic development acts as a driving force. Consequently both the variables should be consistent with development levels. The government of India should bring constrictive plans to deal with increasing migrants to urban in the future due to rise in economic progress

Keywords


Granger Causality, Migration, Economic Growth, ARDL, Co-integration etc

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