The nexus between inflation and trade openness has been one of the major concerns among the researchers and policy makers in both developed and developing economies. The exact relationship between inflation and openness is still in ambiguity. Various studies have been done for different countries and regional groups using different methodologies to measure the relationship between openness and inflation, but all remained in vain. Although there are different views regarding this relationship, most of the empirical studies supported the Romer’s hypothesis (Q J Econ 108(4):869–903, 1993) of an inverse association between openness and inflation in the economy. The present study has made an attempt to examine the factors influencing the price level, especially trade openness, in India from 1974–1975 to 2015–2016. For empirical investigation, the study has employed autoregressive distributed lag (ARDL) model bounds testing approach to co-integration (Pesaran et al., J Appl Econ 16(3):289–326, 2001). The obtained results revealed the presence of positive relationship between inflation and trade openness in India, which negates the Romer’s hypothesis.

中文翻译：

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印度贸易开放与通货膨胀的实证研究

通货膨胀与贸易开放之间的关系一直是发达经济体和发展中经济体的研究人员和政策制定者的主要关切之一。通货膨胀与开放之间的确切关系仍然不明确。对于不同的国家和地区集团，已经使用不同的方法来测量开放度和通货膨胀之间的关系，进行了各种研究，但是所有的研究都是徒劳的。尽管对于这种关系有不同的看法，但是大多数经验研究都支持罗默的假设（QJ Econ 108（4）：869-903，1993），即经济开放性和通货膨胀之间的反相关关系。本研究试图检验1974年至1975年至2015年至2016年印度的影响价格水平的因素，尤其是贸易开放度。为了进行实证研究，该研究采用自回归分布滞后（ARDL）模型边界测试方法进行协整（Pesaran等人，J Appl Econ 16（3）：289–326，2001）。获得的结果表明，印度通货膨胀与贸易开放之间存在正相关关系，这否定了罗默的假设。