An Econometric Analysis of Income and Expenditure of Rajasthan State

Abstract

The study is mainly focused on causal relation between income and expenditure of Rajasthan state for the period of 2000-01 to 2022-23. The secondary data related to total revenue receipt, total capital receipt, total receipt, total revenue expenditure, total capital expenditure and total expenditure were used to construct eight models. The unit root test indicated that all variables are non-stationary at level and stationary at first difference except total capital revenue and total capital expenditure which are stationary at level but the non-stationary variables consist in model 1, 3. 4. 6, 7 and 8 are co-integrated. The Unidirectional Causality running from revenue receipt to revenue expenditure in long run and short run. The bidirectional long run causality existed between capital revenue and capital expenditure and total revenue and total expenditure but there is no short run causality between capital revenue and capital expenditure whereas the bidirectional shorter run causality existed between total expenditure and total revenue.