ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846
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Measurement Issues in Comparing Fiscal Performance of States

Interstate comparison of fiscal performance requires the use of appropriate concepts and proper measurement of state income, fiscal deficit and debt. GSDP at market prices and a comprehensive concept of debt consistent with the fiscal deficit of a state government are the right concepts to use for the purpose. Neither the rating agencies nor the finance commissions have used the right concepts so far. Illustrative estimates for Gujarat show that this can lead to misleading target setting and wrong perceptions about the fiscal performance of the states.



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Updated On : 6th Apr, 2017

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