Articles by Ashok K Nag

This paper makes an attempt to assess the impact of imposition of uniform capital requirement norm on flow of credit to the business sector by the most important segment of the Indian banking sector, i e, Indian public sector banks. A simple decomposition analysis of growth in assets portfolio as well as a model based analysis of credit growth for the Indian public sector banks corroborated that (a) in the post reform period, public sector banks did shift their portfolio in a way that reduce their capital requirements and (b) adoption of stricter risk management practice in respect of bank lending in the post reform period and its interplay with minimum capital requirements (regulatory pressure) have had a dampening effect on the overall credit supply.

Power Parity AS an empirical economic proposition the purchasing power parity (PPP) theory merely states that international prices of traded goods and services when converted to a common currency should equalise across national boundaries. If allowances are made for the price distorting effect of tariff and non-tariff barriers to trade there is no reason why law of one price (LOP) should not hold good for the traded goods and services at the world level. Existence of arbitrage traders in goods market should ensure that.