Journal
AMERICAN JOURNAL OF AGRICULTURAL ECONOMICS
Volume 105, Issue 1, Pages 316-340Publisher
WILEY
DOI: 10.1111/ajae.12317
Keywords
agricultural markets; demonetization; difference in differences; India; persistence; shock; triple differences
Categories
Ask authors/readers for more resources
This study examines the impact of India's 2016 demonetization on domestic agricultural trade. The findings show that trade value decreased by 16.3-16.8% in the short term, settling at 11.8-12.1% after eight months.
We examine the impact of an extreme monetary shock, India's demonetization of 2016, on domestic agricultural trade. Using data from around 3000 regulated markets for 35 major crops, we find that trade value fell by 16.3-16.8% in the short run, settling at 11.8-12.1% after eight months, driven primarily by a decline in prices. Triple difference estimates suggest sharpest impacts for kharif crops, perishables and crops with minimal government intervention. Markets far away from banks fared worse. Our results suggest that the implosion of value of agricultural trade domestically persisted two growing seasons beyond the one that coincided with the shock, whereas existing findings suggest that the negative impact on the economy as a whole dissipates in that time.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available