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on Central and Western Asia |
| By: | Gehl Sampath, Padmashree (UNU-MERIT) |
| Abstract: | The Indian pharmaceutical industry is presently going through a phase of transition and potential consolidation, owing to India's new TRIPS-compliant intellectual property regime and other rules aimed at enhancing the industry's credibility nationally and internationally. Appropriate policy interventions can play a large role in cushioning the transition (and gradual consolidation) of the industry post-2005. Using firm level data collected in 2004-2005, this paper seeks to make two major contributions in this regard. The research findings show that the Indian pharmaceutical sector is a heterogeneous mix of firms with vast differences in innovative capabilities. Based on these differences, the groups can be categorized into specific "innovation modes" (the innovator, the niche operator and the manufacturer), each mode being a step closer towards the innovative pharmaceutical firm. Second, the paper highlights how the emerging strategies of firms in all three groups, although different, underpin the importance of systemic coordination in the pharmaceutical sector. The analysis links both these findings to policies pursued in the pharmaceutical sector over the past four decades and highlights the role of differential innovation policy in ensuring optimal sectoral performance. |
| Keywords: | Pharmaceutical industry, Innovation policy, TRIPS, Intellectual Propery, IPR, Property rights, India |
| JEL: | L65 O33 O34 O38 O53 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2006031&r=cwa |
| By: | Sumon Kumar Bhaumik (Brunel University); Manisha Chakrabarty (Keele University, Centre for Economic Research and School of Economic and Management Studies) |
| Abstract: | Since 1989, there has been a sharp increase in the role of caste in determining political fortunes at both state and federal levels in India. As a consequence, significant inter-caste differences in earnings have the potential to stall the process of economic reforms. Yet, the patterns and determinants of such differences remain unexplored. We address this lacuna in the literature, and explore the determinants of the differences in inter-caste earnings in India during the 1987-99 period, using the 43rd and 55th rounds of National Sample Survey (NSS). Our results suggest that earnings differences between upper castes and SC/ST have declined between 1987 and 1999, and (b) inter-caste differences in earnings can be explained largely by corresponding differences in educational endowment and returns on age (and, hence, experience). However, differences in returns on education do not explain inter-caste earnings differences to a great extent. |
| Keywords: | Inequality, Caste, India |
| JEL: | O15 O17 |
| Date: | 2006–06 |
| URL: | http://d.repec.org/n?u=RePEc:kee:kerpuk:2006/13&r=cwa |
| By: | Vohra Seema; Dutta Goutam; Ghosh D.K. |
| Abstract: | In this paper, we describe the capacity management of Intensive Care Units (ICUs) in a 300-bed multi-specialty hospital where the alternative ICU is utilized when the appropriate ICU is full for a set of two types of ICUs. Inter-arrival time and service time distributions in these ICUs have been tested and found to be exponentially distributed. While most capacity management models are deterministic in nature, we have developed a queuing model to provide a basis for decision-making in the design and management of these ICUs. The model results in around 19800 linear steady state equations, which are solved using the CPLEX linear optimization solver. Based on real data available from a hospital in India, the results demonstrate that the utilization of the ICU beds will improve up to 28 percent when admissions to the alternative ICU are permitted. |
| Keywords: | OR in health services, Queuing, Productivity and Competitiveness |
| Date: | 2006–07–12 |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:2006-07-04&r=cwa |
| By: | Yaprak Gulcan (Department of Economics, Faculty of Business, Dokuz Eylül University); Mustafa Erhan Bilman (Department of Economics, Faculty of Business, Dokuz Eylül University) |
| Abstract: | This study investigates the effect of budget deficit reduction on exchange rate between US dollar and Turkish lira (TL). Our article aims to illustrate that the evidence on the relationship between budget deficits and exchange rates is not clear-cut and to explain why the theoretical approaches that underlie the relationship are ambiguous while there is general agreement that cutting budget deficits and debt will lower interest rates. The relationship between deficit reduction and exchange rates has caused a debate among the most famous monetary policy makers and researchers. [Melvin (1989), Mishkin (1992), Greenspan (1995), Thiessen (1995), Krugman (1995), Feldstein (1995)] In addition, budget deficit can be counted as one of the most common and major problem that influences the macroeconomic stability in developing economies. In this sense, cointegration method and causality tests were used in order to find out the possible effects of budget deficit reduction on exchange rates during the period of 1960-2003 in Turkey. |
| Keywords: | Budget deficits, exchange rates, cointegration analysis |
| JEL: | H62 F31 |
| Date: | 2005–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:deu:dpaper:0507&r=cwa |
| By: | Morris Sebastian; Basant Rakesh |
| Abstract: | Sustained very high rate of growth (above 8% in the context today in India) would be able to achieve (since a labour productivity growth of 4 to 4.5 % is to be factored in) a labour absorption rate of 3.5 to 4% which is about a percent above the growth in the rate of the workforce. But slower growth of around 6% which is what India seems to be achieving in the 90s on an average would keep disguised unemployment alive for long. Similarly, the transformation of firms and especially SMEs which have little autonomous capacity is itself a function of growth oriented policies. In the nineties labour has been sufficiently flexible to allow rapid growth whenever demand was high. In any case the unorganised workers, did not have the ability to resist hire and fire. Demand has been lower than possible otherwise since the rupee especially in comparison to the East Asian currencies has not been aggressively priced. Lacking a very rapid growth in the market sufficient to overcome disguised unemployment, the transformation of these industries has itself been affected. Similarly the continuation of tariff inversion, high and uncompensated energy taxes hurt manufacturing and especially the small and medium sector whose dependence on relative factor cost is higher. The slow movement towards de-reservation has further attenuated the process. The dynamic inefficiencies and distortions are far more significant than the static efficiency penalty that the economy pays in the continuation of reservation. Without these corrections the move to have “free-trade” agreements with the ASEAN countries would hurt manufacturing in India and especially the SMEs. Many of the traditional small firms are in clusters, and a cluster oriented approach would be important for their success. A strategy based on leveraging trade names /brand names, many of which could be argued to be "geographic indicators", with much equity world wide, would require immediate changes in our intellectual property rights regime. Costs of excise registration and dealing with excise authorities are too large, and there is a 'fixed' component to this cost which cannot be spread over a large value of turnover. Only significantly lower excise rates for small firms could compensate them sufficiently. The criteria of "with and without the use of power" in the Factories Act, be entirely dispensed with. All units with more than 50 employees including the entrepreneur and family labour, be brought /retained under (all) the provisions of the Factories Act. And all other units be entirely exempt from its provisions. Credit is the single most important constraint for small firms. Incentivisation of priority sector targets is the solution. The policy of directed lending to small firms (the targets for priority sector lending) ought to shift from targets or quotas to incentives to banks for lending to small firms. Responsible risk taking in lending would have to re-emerge. Tax based incentives for banks and financial intermediaries are possible. Statutory Reserves based incentives for banks too are possible. Concessions on interest rates are dysfunctional, though the margin above PLR rates ought to be subject to a ceiling. State Finance Corporations which could play a crucial role in financing of SMEs would have to go through quick restructuring and refocus on promotion of new enterprises typically where vast positive external effects are anticipated, such as in technology based small firms, promising industries, nodal industries, industrial estate corporations, in exchanging specific infrastructural support to existing clusters of small firms, etc. Investments in infrastructure especially general roads, power, railways, and water supply would help to improve the performance of small firms significantly. For all small firms power and water continue to remain constraints shamefully after nearly 10 years of reform. These can easily come down at least for export industries if the taxes and cross subsidies on them are made vattable. Despite the Electricity Act 2003, it is shameful that open-access has not been extended to SMEs. Technology based and skill labour using industries such as IT, BT, pharmaceuticals and auto oriented industries, also need to be exploited. In automobiles taxes are still very large and the inverted tariffs / high cost of materials and energy that are uncompensated hurt the prospects of India emerging as a base for manufactures. In IT, Biotechnology, pharmaceutical industries and other related offshoring activities the challenges lie in bringing about better IPR regimes that reduces the risk faced by foreign firms in their operations in India. IPR regimes requiring much insight would have to be worked work out that is able to balance the interest of Indian firms and yet lead to much industrial relocation. The addition of a petty patent register could considerably enhance the extraction of value from the many innovations that take place in the SME sector. Municipal infrastructure is inadequate and its correction in at least a few cities is of crucial importance to the growth of the off-shoring activities and growth in these industries. Financial institutions could usefully develop strong venture capital arms to finance innovative small firms that have a good potential to emerge in the near future in many industries. Problems with government procurement which are ‘designed to fail’ keeps alive a very large market for shoddy goods among SMEs. Merging of the umpteen laws and regulations into one wherever feasible can reduce the currently large costs of SMEs in dealing with government. |
| Keywords: | Small-Firms; Industry-structure; India; SME; International-Trade; Globalisation; Country-studies; economic-development |
| JEL: | O1 |
| Date: | 2006–07–11 |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:2006-07-03&r=cwa |
| By: | Sedef Akgüngör (Department of Economics, Faculty of Business, Dokuz Eylül University); Pinar Falcioglu (Department of Management, Isik University) |
| Abstract: | The dynamics of industrial agglomeration across the regions and the reasons for such agglomeration have been the focus of interest particularly in exploring the effects of economic integration of regions on the spatial distribution of economic activity. In this context, following the predictions of the literature on economic geography, Turkey’s integration with the European Union as a candidate member is a likely cause of changes in economic dispersion of the economic activity over the years. The major objective of the study is to complement the findings of the studies on industrial agglomeration in Turkey’s manufacturing industry by exploring whether specialization and concentration patterns have changed over time and to expose the driving forces of geographic concentration in Turkey’s manufacturing industry, particularly during Turkey’s economic integration process with the European Union under the customs union established in 1996. Industrial concentration and regional specialization are measured by GINI index for NUTS 2 regions at the 2-digit level for the years between 1992 and 2001. To investigate which variables determine industry concentration, the systematic relation between the characteristics of the industry and geographical concentration is tested. A regression equation is estimated, where the dependent variable is GINI concentration index and the independent variables are the variables that represent the characteristics of the sectors. The major finding of the study is that Turkey’s manufacturing industry has a tendency for regional specialization. Increase in the average value for regional specialization supports the prediction developed by Krugman that regions become more specialized with regional integration. But there is no evidence for increased industrial concentration in Turkish manufacturing industry, contrary to the expectations. As for the answer to which variables determine industry concentration, the analysis supports the hypothesis that the firms tend to cluster in regions where there are economies of scale and there are significant linkages between firms, supporting the predictions of new trade theory and economic geography. |
| Keywords: | Regional specialization, geographical concentration, economic integration, geographical economics |
| JEL: | L60 R10 R11 R12 R15 |
| Date: | 2005–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:deu:dpaper:0501&r=cwa |
| By: | Yesim Kustepeli (Department of Economics, Faculty of Business, Dokuz Eylül University); Onur Sapci (Department of Economics, Faculty of Business, Dokuz Eylül University) |
| Abstract: | The estimation of tax elasticity; the response of tax revenues to changes in income, is important for at least three reasons: i) formulating government budgets and monitoring tax collections (Sen, 2002), ii) the specification of tax functions, iii) the automatic stabilizing properties of the tax system and the public sector deficit (Hutton, Lambert; 1980, 1982). Among the various approaches to tax elasticity calculation in literature (Tanzi, 1969, 1976; Greytak and McHugh, 1978; Hutton and Lambert, 1980; Ehdaie, 1990), the most famous approach is Tanzi’s Method due to its simplicity and the consensus about its correctness of elasticity estimates. Johansen cointegration tests for the period 1975 - 2005 show that personal income tax elasticity in Turkey is around 0.95, indicating almost unit elasticity. Increasing income can be considered as insurance to maintain an equivalent increase in tax revenue; however it doesn’t seem to be the way to obtain higher tax revenues. |
| Keywords: | Personal income tax, tax elasticity, Tanzi method |
| JEL: | E62 H24 |
| Date: | 2006–07–11 |
| URL: | http://d.repec.org/n?u=RePEc:deu:dpaper:0601&r=cwa |
| By: | Yesim Kustepeli (Department of Economics, Faculty of Business, Dokuz Eylül University); Gülcan Önel (Department of Economics, Faculty of Business, Dokuz Eylül University) |
| Abstract: | Recent theoretical and empirical research has considered how differences in political arrangements affecting national policy formation might explain variation in fiscal policies pursued (Volkerink and de Haan, 2001). The experience of high government deficits of developed nations in the 1980s led researchers to analyze the reasons for this and among other factors they have argued that political variables could also explain budget deficits (Sutter, 2003). This study aims to investigate the effects of the political parties for fiscal deficits in Turkey for 1976-2004 period. Our results show that the most important variable in explaining the budget deficit to GDP ratio in Turkey is its lagged value. The political dispersion index variable, which measures the effect of the number of parties in the government in power, has proven to have a minor effect. Only the coalition governments with two or more parties are found to have higher budget deficit to GDP ratios. Ideology of the governments in power is important for the budget deficit to GDP ratio when it is considered with the number of parties in the government in power. In general, it can be said that polarization, fragmentation and ideology of the governments do not play an important role in explaining the budget deficit to GDP ratio. |
| Keywords: | Budget deficits, political fragmentation, dispersion indexes |
| Date: | 2005–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:deu:dpaper:0502&r=cwa |
| By: | Olof Johansson Stenman (Göteborg University); Minhaj Mahmud (Keele University, Centre for Economic Research and School of Economic and Management Studies); Peter Martinsson (Göteborg University) |
| Abstract: | Levels of trust are measured by asking standard survey questions on trust and by observing the behaviour in a trust game using a random sample in rural Bangladesh. Follow-up questions and correlations between stated expectations and the sent amount in the trust game reveal that the amount sent in the trust game is a weak measure of trust. The fear of future punishment, either during or after this life, for not being sufficiently generous to others, was the most frequently stated motive behind the respondents' behaviour, highlighting the potential importance of motives that cannot be inferred directly from people's behaviour. |
| Keywords: | Trust; trust game; social capital; motivations; Bangladesh. |
| JEL: | C93 Z13 |
| Date: | 2006–06 |
| URL: | http://d.repec.org/n?u=RePEc:kee:kerpuk:2006/11&r=cwa |
| By: | Yesim Kustepeli (Department of Economics, Faculty of Business, Dokuz Eylül University) |
| Abstract: | Using a panel data analysis, the relationship between government size and economic growth is investigated for the 1994-2001 period. The results show that relatively small sizes of government are detrimental to economic growth, while medium sized government affects it positively. |
| Keywords: | government size, economic growth, panel data, new European Union members and candidates |
| JEL: | E62 O40 |
| Date: | 2005–12–06 |
| URL: | http://d.repec.org/n?u=RePEc:deu:dpaper:0506&r=cwa |
| By: | Gupta Ramesh |
| Abstract: | This paper suggests a roadmap for IIM Ahmedabad to increase its intake substantially with available resources in its flagship ‘Post Graduate Program in Management’ (PGP equivalent to MBA). Solutions for other IIMs should be similar as all share similar programs, ethos and culture; differences would be only in details. The suggested measures are: a) Restructure Fellow Program in Management (FPM) – IIMs Ph.D. Program Currently 22 equivalents of faculty resources are used in teaching 10-15 FPM students in the second year alone. Only 6-8 students graduate every year. To justify efficient use of available faculty resource - FPM intake either should be increased four-fold (to 60 from present 15), or merge all streams and award ‘Fellow in Management’ with specialization at thesis stage. This is very common in many universities facing similar constraints. The first option would increase supply of faculty for hire in future (should have been done lone time ago); the second would immediately release 15 faculty for PGP expansion. b) Review expansion plans of PGP for Executives (PGPx). There is not much international about its student body or academic offering. Admitted students are mostly NRIs who are seeking leverages with PGP brand for better placement abroad after getting the cheapest possible MBA in the world. Moreover, it is heavily subsidized Rs. 3 lakh per participant (Rs. 2 crore for current batch) just to recover direct cost. c) Require faculty who migrated to centers/groups (like health, energy etc.) to have same teaching load as others. All these centers are leveraging on PGP brand and concerned faculty involved must fulfill their obligations to PGP. d) At present two dorms on new campus are kept for non-regular events (cultural and intellectual). These can house 60 students on regular basis. Temporary arrangements can be planned for non-regular events. e) There is no justification for offering married accommodation for one year program on campus, particularly when IIMs practice a ‘pressure cooker’ approach of teaching. Families with children are distraction. Two students can easily be put in newly built apartments accommodating additional 100 participants. To sum it up, IIMA can increase its PGP intake substantially by a) better utilization of physical infrastructure b) better faculty time management by restructuring programs and active faculty recruitment in deficit areas; and c) by defining its priorities more sharply. IIMs PGP product is the best and why dilute it by allowing remotely related activities to have free ride on it? The paper also covers issues like autonomy, increasing role of alumni and almost extinct faculty governance. It is not concerned with ‘OBC reservation policy’. |
| Date: | 2006–07–17 |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:2006-07-05&r=cwa |
| By: | Olof Johansson Stenman (Göteborg University); Minhaj Mahmud (Keele University, Centre for Economic Research and School of Economic and Management Studies); Peter Martinsson (Göteborg University) |
| Abstract: | Trust is measured using both survey questions and a standard trust experiment among a random sample of Muslim and Hindu household heads in rural Bangladesh. We found no significant effect of the social distance between Hindus and Muslims in the trust experiment in terms of fractions sent or returned, but the responses to the survey questions do indicate significant differences. Hindus, the minority, trust other people less in general, while Hindus trust Muslims more than Muslims trust Hindus. |
| Keywords: | Social capital; Trust; Social distance; Religion; Trust game; field experiment; Bangladesh. |
| JEL: | C93 Z12 Z13 |
| Date: | 2006–06 |
| URL: | http://d.repec.org/n?u=RePEc:kee:kerpuk:2006/10&r=cwa |