Abstract

This study investigates the determinants of manufacturing output in India for the period 2000 to 2019 considering 25 states of India. The study employed panel data regression analysis on secondary data extracted from EPWRF. Traditional panel data models of POLS, FEM and REM have been estimated along with the long-run FMOLS and DOLS models. As per the result, variables of total persons engaged, fixed capital, working capital, fuel consumed and output of service sector have positive and significant influence on output of the manufacturing sector in India but agriculture production have negative and significant impact on manufacturing output in long-run. Among the three models, the study found out that Fixed Effect model is the most appropriate model and as per the FMOLS and DOLS model there exist a long-term association between the variables.