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on Central and Western Asia |
| By: | Vinish, Kathuria; Seethamma Natarajan, Rajesh Raj; Sen, Kunal |
| Abstract: | It is commonly argued that a better investment climate reform – that is, lower distortions in the institutional, policy and regulatory environment in which firms operate - lead to discernible improvements in firm performance. In this paper, we argue that effective state business relations condition better investment climate outcomes and that the deeper institutional determinants of firm performance are the former. We examine the effect of effective state-business relations of total factor productivity (TFP) for formal sector firms in India for the years 2000-01 and 2004-05 and find support for this hypothesis. |
| Keywords: | State business relations; total factor productivity; India |
| JEL: | D24 |
| Date: | 2010–01–23 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20316&r=cwa |
| By: | Arvind Virmani |
| Abstract: | In this paper the issue of indirect tax reform, with a special focus on customs duty reform is examined. [WP] |
| Keywords: | goods, tariff, surcharge, Asian, Nepal, competitive economy, china, indirect tax reform, customs duty, EXCISE, India, SALES TAXES |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2387&r=cwa |
| By: | Kathuria, Vinish; Seethamma Natarajan, Rajesh Raj; Sen, Kunal |
| Abstract: | Empirical studies on total factor productivity growth (TFPG) in developing countries highlight trade open-ness, research and development and market structure as being the most important determinants of TFPG. The role of institutions remains overlooked in the literature on the determinants of TFPG. In this paper, we look into the role of institutional quality as captured by effective state-business relationships (SBRs) in influencing TFPG, using Indian manufacturing as a case-study. By SBRs we mean a set of highly institutionalised, responsive and public interactions between the state and the business sector. To compute TFPG, we use firm level data for both the formal and informal manufacturing sector. We correct for the simultaneity bias associated with the production function approach for TFPG estimation by employing a method developed by Levinsohn and Petrin. We propose measures of effective SBRs for 15 Indian States over the period 1994-2005, and then use them in TFP growth equations to estimate the effect of SBR on TFPG. The results indicate that SBR has positively affected the TFP growth of Indian industry. The effect however is primarily for the formal sector. |
| Keywords: | State-business relations; Indian Manufacturing; Total Factor Productivity Growth |
| JEL: | D24 O14 |
| Date: | 2010–01–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20314&r=cwa |
| By: | Kathuria, Vinish; Seethamma Natarajan, Rajesh Raj; Sen, Kunal |
| Abstract: | This paper analyses the productivity performance of the Indian manufacturing sector using unit level data, which is aggregated at four-digit industry level for the period 1994-95 to 2004-05 for 15 major states. The study focuses on both the organized and unorganized segments of the manufacturing sector. Both partial and total factor productivity (TFP) measures have been employed to trace the productivity performance of formal and informal manufacturing sector. TFP is estimated using Cobb-Douglas production functions at the four-digit industry level. The estimation is carried out by employing the Levinsohn-Petrin method, which uses intermediate inputs as the proxy to address the potential simultaneity bias in production function estimations. Our analysis reveals that labour productivity has increased for the organized sector over time whereas both labour productivity and capital intensity growth have slowed down in the unorganized sector during the 2000-01 to 2004-05 period. The production function analysis shows that capital has played a more significant role in the production process in both the sectors. TFP growth accelerated in the organized manufacturing sector during 2001-05 over 1995-2001 while the TFP decline that started in the first period (1995-2001) continued unabated even in the second period (2001-2005) in the unorganized manufacturing sector. We also find that output growth in both the sectors is productivity driven and not input driven. The improvement in TFPG of organized manufacturing in the post-2000 period as compared to the second half the 1990s across most states in India and that output growth was mostly productivity driven are important positive features of manufacturing performance in the post-reform period. However, the declining total factor productivity on one hand and increasing capital intensity of the unorganized sector is a cause of worry and raises several important questions. |
| Keywords: | Productivity; Organized manufacturing; Unorganized sector; Industrial Sector |
| JEL: | D24 |
| Date: | 2010–01–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20317&r=cwa |
| By: | Athreye, Suma |
| Abstract: | It is commonly believed that the business environment in developing countries does not allow productive technology-based entrepreneurship to flourish. In this paper, we draw on the experience of Indian software firms where entrepreneurial growth has belied these predictions. This paper argues that the business models chosen by Indian firms were those that best aligned the country’s abundant labour resources and advantages to global demand. Many potentially higher value added opportunities struggled to attain success, but the qualitative value of experimental failures and the capability gaps they exposed was invaluable for collective managerial learning in the industry. Second, the paper also shows that the presence of growth opportunities and the success of firms stimulated institutional evolution to promote entrepreneurial growth. Last we show that the distinctive aggregate contribution of entrepreneurial firms was that they outperformed business houses and multinational subsidiaries in their more productive use of available capital resources whilst achieving similar levels of growth in output and employment. This paper draws upon an earlier shorter paper co-authored with Mike Hobday and titled 'Overcoming Development Adversity: How Entrepreneurs Led Software Development in India'. |
| Keywords: | Technology entrepreneurship, institutions and economic development, Indian software, intellectual property rights |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2010-04&r=cwa |
| By: | Bala Subrahmanya, M. H.; Mathirajan, M.; Krishnaswamy, K. N. |
| Abstract: | This paper probes the drivers, dimensions, achievements, and outcomes of technological innovations carried out by SMEs in the auto components, electronics, and machine tool sectors of Bangalore in India. Further, it ascertains the growth rates of innovative SMEs vis-à-vis non-innovative SMEs in terms of sales turnover, employment, and investment. Thereafter, it probes the relationship between innovation and growth of SMEs by (i) estimating a correlation between innovation sales and sales growth, (ii) calculating innovation sales for high, medium, and low growth innovative SMEs and doing a aggregate one-way ANOVA, and (iii) ascertaining the influence of innovation sales, along with investment growth and employment growth on gross value-added growth by means of multiple regression analysis. The paper brings out substantial evidence to argue that innovations of SMEs contributed to their growth. |
| Keywords: | Technological innovations, sales growth, auto components, electronics, machine tools, Bangalore |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2010-03&r=cwa |
| By: | Ivan O. Kitov |
| Abstract: | Labor productivity in Turkey, Spain, Belgium, Austria, Switzerland, and New Zealand has been analyzed and modeled. These counties extend the previously analyzed set of the US, UK, Japan, France, Italy, and Canada. Modelling is based on the link between the rate of labor participation and real GDP per capita. New results validate the link and allow predicting a drop in productivity by 2010 in almost all studied countries. |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1001.4889&r=cwa |
| By: | Kumar Gaurav; Mayank Singhal |
| Abstract: | To find out whether our government is spending an astronomical amount of taxpayer’s money publicising itself rather than disseminating information, facts and figures were assimilated. By tracking five leading national dailies for government advertisements, over the month of June 2003., the quantum of government advertisements, their classification into informative ads and promotional ads and to estimate the cost of issuing these ads that the government incurs. [CCS WP no. 0049]. |
| Keywords: | government spending, information, publicity, promotional ads, advertisement, taxpayer's money, newspaper, Indian |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2390&r=cwa |
| By: | Naila Kabeer |
| Abstract: | This paper examines national-level explanations for poverty decline in Bangladesh in micro-level detail, in order to better understand the nature of the causalities at work and why some households have gained, while others have failed to gain, in the processes of change involved. The analysis is based on empirical data on the lives and livelihoods of rural households in two locations: Chandina thana in Comilla district and Modhupur thana in Tangail district. The data is drawn from panel data on 1184 household in 1994 and 2001, and qualitative data collected by the author at various points during the period covered by the study. The paper demonstrates that the distribution of ‘winners’ and ‘losers’ is not determined purely by chance; it also reflects differences in endowments and efforts. |
| Keywords: | households, qualitative data, population growth, agriculture, Green Revolution, cultivation, imports, endowments, economic change, poverty decline, Human resources, gender, mobility, per capita income, Bangladesh, livelihoods, rural |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2385&r=cwa |
| By: | Arturo Galindo; Alejandro Izquierdo; Liliana Rojas-Suarez |
| Abstract: | This paper explores the impact of international financial integration on credit markets in Latin America, using a cross-country dataset covering 17 countries between 1996 and 2008. It is found that financial integration amplifies the impact of international financial shocks on aggregate credit and interest rate fluctuations. Nonetheless, the net impact of integration on deepening credit markets dominates for the large majority of states of nature. The paper also uses a detailed bank-level dataset that covers more than 500 banks for a similar time period to explore the role of financial integration—captured through the participation of foreign banks—in propagating external shocks. It is found that interest rates charged and loans supplied by foreign-owned banks respond more to external financial shocks than those supplied by domestically owned banks. This does not hold for all foreign banks. Spanish banks in the sample behave more like domestic banks and do not amplify the impact of foreign shocks on credit and interest rates. |
| Keywords: | Foreign Banks, Credit, Interest Rates, Financial Shocks |
| JEL: | F36 G0 G21 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:4651&r=cwa |
| By: | Annegret Maehler (GIGA Institute of Global and Area Studies) |
| Abstract: | This paper studies the oil-violence link in the Niger Delta, systematically taking into consideration domestic and international contextual factors. The case study, which focuses on explaining the increase in violence since the second half of the 1990s, confirms the differentiated interplay of resource-specific and non-resource-specific causal factors. With regard to the key contextual conditions responsible for violence, the results underline the basic relevance of cultural cleavages and political-institutional and socioeconomic weakness that existed even before the beginning of the “oil era.” Oil has indirectly boosted the risk of violent conflicts through a further distortion of the national economy. Moreover, the transition to democratic rule in 1999 decisively increased the opportunities for violent struggle, in a twofold manner: firstly, through the easing of political repression and, secondly, through the spread of armed youth groups, which have been fostered by corrupt politicians. These incidents imply that violence in the Niger Delta is increasingly driven by the autonomous dynamics of an economy of violence: the involvement of security forces, politicians and (international) businessmen in illegal oil theft helps to explain the perpetuation of the violent conflicts at a low level of intensity. |
| Keywords: | Nigeria, natural resources, oil, political economy, violence, context sensitivity |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:gig:wpaper:120&r=cwa |