Debt Dynamics in India

This repository consists of the code and data for the paper Fiscal rules and debt dynamics in India, published in Macroeconomics and Finance in Emerging Market Economies.

Repo Structure

The repository consists of the following folders:

• 1_data: Clean csvs, named by figure number
• 2_code: Code required to output tables
• 3_figures: Final figures used in paper

Code

The folder 2_code consists of the following scripts

• 01_figs_trends.py: Python file producing Figures 1-7, 9 and C1 (a)-C1(j).
• 02_figs_simulations.R: R file producing Figures 10-11 and A1-A10.

Figures 8 and 12 were produced by uploading the respective csvs on Google Sheets.

Replication

In order to replicate the above figures, ensure you have the following packages installed in Python: pandas, plotly, kaleido, pyprojroot. In R, ensure you have the plotly package installed.

Note: In order for the figures to be saved, please ensure that you only install the following version of Kaleido, by running

pip install --upgrade "kaleido==0.1.0post1"

Once these are installed, execute the following steps

1. From 2_code, open and run 01_figs_trends.py. Ensure that you open the folder that the project is saved in using a text editor like VS code so that the root directory is correctly set.

2. Open 02_figs_simulations.R. Depending on the state/scenario, choose the initial and target debt levels, as well as the time to hit target. Specify the range for interest and growth rates, whose lower and upper limits is one percent below/above the 10 year average. The average can be computed from the individual csvs for each state. Once, parameters are set, run the file, and save plot generated in the window.

Software

Python 3.11 (via VS code) and R Studio were used to run the code scripts. Data files are stored in Microsoft Excel 16.