Pub Date : 2019-11-01DOI: 10.1108/igdr-06-2019-0055
P. Robertson, Jingdong Yuan, Harsha Konara Mudiyanselage
Purpose The purpose of this paper is to describe how China’s rapid growth and increasing resource dependence have changed its relationship with India and their respective defense strategies. In particular, we consider China's Belt and Road Initiative, India's “Act East” policy and the strategic and economic value of the Indian Ocean and South China Sea regions. Design/methodology/approach The authors find no econometric evidence of interactions between China and India’s military spending using a Richardson-Baumol arms race model. Likewise, in a cross-county panel data study of military spending, they find that China’s military spending has no independent effect on military spending in other countries. The authors also show that once wage costs and other sources of military inflation are accounted for, the pattern of real defense spending growth is much less intense than is suggested by nominal data. Nevertheless, they show that China has been undertaking intense military modernization with rapidly rising capital-labor ratios in its defense spending. Findings The authors find little evidence of a traditional arms race, but also show that China, and to a lesser extent India, have been realigning their military capabilities to these new security risks while maintaining overall military burden on the economy. Research limitations/implications Econometric analysis is limited by data availability and is necessarily historical, whereas the security situation is very fluid and may change in the short term. Practical implications The paper identifies factors that are likely to influence China and India's attitudes to defense spending in the coming years. Social implications The paper finds that there is not an arms race in the traditional sense but may be an arms race in terms of new technologies and military modernization. Originality/value This is a very much underexplored topic in economics. The authors take an interdisciplinary approach showing how economics tools can be used to help understand this important issue in international relations.
{"title":"China, India and the contest for the Indo-Pacific","authors":"P. Robertson, Jingdong Yuan, Harsha Konara Mudiyanselage","doi":"10.1108/igdr-06-2019-0055","DOIUrl":"https://doi.org/10.1108/igdr-06-2019-0055","url":null,"abstract":"\u0000Purpose\u0000The purpose of this paper is to describe how China’s rapid growth and increasing resource dependence have changed its relationship with India and their respective defense strategies. In particular, we consider China's Belt and Road Initiative, India's “Act East” policy and the strategic and economic value of the Indian Ocean and South China Sea regions.\u0000\u0000\u0000Design/methodology/approach\u0000The authors find no econometric evidence of interactions between China and India’s military spending using a Richardson-Baumol arms race model. Likewise, in a cross-county panel data study of military spending, they find that China’s military spending has no independent effect on military spending in other countries. The authors also show that once wage costs and other sources of military inflation are accounted for, the pattern of real defense spending growth is much less intense than is suggested by nominal data. Nevertheless, they show that China has been undertaking intense military modernization with rapidly rising capital-labor ratios in its defense spending.\u0000\u0000\u0000Findings\u0000The authors find little evidence of a traditional arms race, but also show that China, and to a lesser extent India, have been realigning their military capabilities to these new security risks while maintaining overall military burden on the economy.\u0000\u0000\u0000Research limitations/implications\u0000Econometric analysis is limited by data availability and is necessarily historical, whereas the security situation is very fluid and may change in the short term.\u0000\u0000\u0000Practical implications\u0000The paper identifies factors that are likely to influence China and India's attitudes to defense spending in the coming years.\u0000\u0000\u0000Social implications\u0000The paper finds that there is not an arms race in the traditional sense but may be an arms race in terms of new technologies and military modernization.\u0000\u0000\u0000Originality/value\u0000This is a very much underexplored topic in economics. The authors take an interdisciplinary approach showing how economics tools can be used to help understand this important issue in international relations.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-06-2019-0055","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43980682","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-11-01DOI: 10.1108/igdr-11-2018-0121
V. Kathuria
Purpose The pulp and paper industry has been the focus of government policies ever since independence. This is the only industry where government plays a multi-dimensional role – not only as the regulator but also as the supplier of raw material and as the buyer. Despite the government's omnipotent role, there is evidence that industry is not very competitive, as it has very high energy and water intensity and poor productivity. A potent factor identified in the literature for the underperformance of the industry or for that matter any economy is the kind of technology used by the firms in the sector. This paper aims to look into the role of government policy in affecting the growth of the industry and what role embodied technology has played in influencing the efficiency of firms in Indian pulp and paper industry. Design/methodology/approach For the first question, the study uses 66 years of production data of the industry from 1951 to 2016 and tests for the structural break. For the second question, the study uses cross-section plant-level data for the year 2011-2012 of 160 paper manufacturing units to first estimate the stochastic production frontier (stochastic frontier analysis [SFA]) and then uses the output of SFA to find an association between embodied technology gap (TG) and technical efficiency. A methodological problem in earlier literature is the use of the productivity gap as a proxy for embodied TG. The present study uses technical parameters of papermaking – machine deckle and operating speed – to construct an index of TG. Findings The results show a structural break in the production trend occurring in 1999 with the delicensing in July 1997 as the possible cause. The SFA results show that the average technical inefficiency (TE) of the firms in the sector is 74 per cent with half of the firms having TE higher than 76 per cent. The study, however, does not find any impact of embodied TG on technical efficiency; rather it is the age, size, ownership and location that have an impact on it. Originality/value This is an original research, as the author has not come across any study in Indian context or elsewhere using technical parameters to construct TG variable.
{"title":"Structural change and technical efficiency: a study of Indian pulp and paper industry","authors":"V. Kathuria","doi":"10.1108/igdr-11-2018-0121","DOIUrl":"https://doi.org/10.1108/igdr-11-2018-0121","url":null,"abstract":"\u0000Purpose\u0000The pulp and paper industry has been the focus of government policies ever since independence. This is the only industry where government plays a multi-dimensional role – not only as the regulator but also as the supplier of raw material and as the buyer. Despite the government's omnipotent role, there is evidence that industry is not very competitive, as it has very high energy and water intensity and poor productivity. A potent factor identified in the literature for the underperformance of the industry or for that matter any economy is the kind of technology used by the firms in the sector. This paper aims to look into the role of government policy in affecting the growth of the industry and what role embodied technology has played in influencing the efficiency of firms in Indian pulp and paper industry.\u0000\u0000\u0000Design/methodology/approach\u0000For the first question, the study uses 66 years of production data of the industry from 1951 to 2016 and tests for the structural break. For the second question, the study uses cross-section plant-level data for the year 2011-2012 of 160 paper manufacturing units to first estimate the stochastic production frontier (stochastic frontier analysis [SFA]) and then uses the output of SFA to find an association between embodied technology gap (TG) and technical efficiency. A methodological problem in earlier literature is the use of the productivity gap as a proxy for embodied TG. The present study uses technical parameters of papermaking – machine deckle and operating speed – to construct an index of TG.\u0000\u0000\u0000Findings\u0000The results show a structural break in the production trend occurring in 1999 with the delicensing in July 1997 as the possible cause. The SFA results show that the average technical inefficiency (TE) of the firms in the sector is 74 per cent with half of the firms having TE higher than 76 per cent. The study, however, does not find any impact of embodied TG on technical efficiency; rather it is the age, size, ownership and location that have an impact on it.\u0000\u0000\u0000Originality/value\u0000This is an original research, as the author has not come across any study in Indian context or elsewhere using technical parameters to construct TG variable.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":"1 1","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-11-2018-0121","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"41866500","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-29DOI: 10.1108/igdr-01-2019-0004
J. Roy, Prabal Roy Chowdhury
Purpose In a global environment where terrorist organisations based in a poor country target a rich nation, this paper aims to study the properties of a dynamically incentive compatible contract designed by the target nation that involves joint counter-terror tasks with costly participation by each country. The counter-terror operations are however subject to ex post moral hazard, so that to incentivise counter-terror, the rich country supplies developmental aid. Development aid also helps avoid unrest arising from counter-terror activities in the target nation. However, aid itself can be diverted to non-developmental projects, generating a novel interlinked moral hazard problem spanning both tasks and rewards. Design/methodology/approach The authors use a dynamic model where the aid giving countries and aid receiving countries behave strategically. Then they solve for the sub game perfect Nash equilibrium of this game. Findings The authors characterise the optimal contract, showing that the dynamic structure of counter-terror resembles the shock-and-awe discussed by military strategists. The authors then prove that it is not necessarily the case that a more hawkish (resp. altruistic) donor is less pro-development (resp. softer on terror). In addition, the authors show that it may be easier to contract for higher counter-terror inputs when the recipient is more sympathetic to terrorists. The authors also discuss other problems faced by developing nations where this model can be readily adopted and the results can endorse appealing policy implications. Originality/value The authors characterise the optimal contract, showing that the dynamic structure of counter-terror resembles the shock-and-awe discussed by military strategists. It is proved that it is not necessarily the case that a more hawkish (resp. altruistic) donor is less pro-development (resp. softer on terror). In addition, the authors show that it may be easier to contract for higher counter-terror inputs when the recipient is more sympathetic to terrorists. Other problems faced by developing nations are also discussed where this model can be readily adopted, and the results can endorse appealing policy implications. These results have important policy implications, in particular in today’s world.
{"title":"Aid and terrorism: a dynamic contracts approach with interlinked moral hazard","authors":"J. Roy, Prabal Roy Chowdhury","doi":"10.1108/igdr-01-2019-0004","DOIUrl":"https://doi.org/10.1108/igdr-01-2019-0004","url":null,"abstract":"\u0000Purpose\u0000In a global environment where terrorist organisations based in a poor country target a rich nation, this paper aims to study the properties of a dynamically incentive compatible contract designed by the target nation that involves joint counter-terror tasks with costly participation by each country. The counter-terror operations are however subject to ex post moral hazard, so that to incentivise counter-terror, the rich country supplies developmental aid. Development aid also helps avoid unrest arising from counter-terror activities in the target nation. However, aid itself can be diverted to non-developmental projects, generating a novel interlinked moral hazard problem spanning both tasks and rewards.\u0000\u0000\u0000Design/methodology/approach\u0000The authors use a dynamic model where the aid giving countries and aid receiving countries behave strategically. Then they solve for the sub game perfect Nash equilibrium of this game.\u0000\u0000\u0000Findings\u0000The authors characterise the optimal contract, showing that the dynamic structure of counter-terror resembles the shock-and-awe discussed by military strategists. The authors then prove that it is not necessarily the case that a more hawkish (resp. altruistic) donor is less pro-development (resp. softer on terror). In addition, the authors show that it may be easier to contract for higher counter-terror inputs when the recipient is more sympathetic to terrorists. The authors also discuss other problems faced by developing nations where this model can be readily adopted and the results can endorse appealing policy implications.\u0000\u0000\u0000Originality/value\u0000The authors characterise the optimal contract, showing that the dynamic structure of counter-terror resembles the shock-and-awe discussed by military strategists. It is proved that it is not necessarily the case that a more hawkish (resp. altruistic) donor is less pro-development (resp. softer on terror). In addition, the authors show that it may be easier to contract for higher counter-terror inputs when the recipient is more sympathetic to terrorists. Other problems faced by developing nations are also discussed where this model can be readily adopted, and the results can endorse appealing policy implications. These results have important policy implications, in particular in today’s world.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-10-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-01-2019-0004","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48409302","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-18DOI: 10.1108/igdr-07-2019-0070
S. Horowitz, Min Ye
Purpose In explaining ethno-territorial conflicts, leadership preferences have an odd status. In case studies, leadership preferences are often viewed as highly significant causes but are not usually defined and measured explicitly. In large-sample statistical studies, leadership preferences are only captured by weakly related proxy variables. This paper aims to fill this gap by developing suitable theory, which can be used consistently in both case study and statistical applications. Design/methodology/approach Formal bargaining models are used to examine the expected impact of variation in leadership preferences. Relevant leadership characteristics are then used to construct measures of variation in leadership preferences, which are applied in case studies. Findings In bargaining models, variation in leadership preferences is expected to have a significant impact on ethno-territorial conflict outcomes. More extreme nationalist leaders and, more conditionally, strongly power-seeking leaders, should be more likely to be willing to use force to modify the status quo – although more moderate nationalist leaderships are also willing to do so under certain conditions. In five case studies, these formally derived hypotheses receive initial empirical support. Originality/value Theoretically and empirically, further refinement of research on variation in leadership preferences promises to add significant value. Formally, it is worth investigating the expected impact of additional preference types. Empirically, it is important to invest in measures of leadership preferences across large samples.
{"title":"Leadership preferences and ethnic bargaining: theory and illustrations","authors":"S. Horowitz, Min Ye","doi":"10.1108/igdr-07-2019-0070","DOIUrl":"https://doi.org/10.1108/igdr-07-2019-0070","url":null,"abstract":"\u0000Purpose\u0000In explaining ethno-territorial conflicts, leadership preferences have an odd status. In case studies, leadership preferences are often viewed as highly significant causes but are not usually defined and measured explicitly. In large-sample statistical studies, leadership preferences are only captured by weakly related proxy variables. This paper aims to fill this gap by developing suitable theory, which can be used consistently in both case study and statistical applications.\u0000\u0000\u0000Design/methodology/approach\u0000Formal bargaining models are used to examine the expected impact of variation in leadership preferences. Relevant leadership characteristics are then used to construct measures of variation in leadership preferences, which are applied in case studies.\u0000\u0000\u0000Findings\u0000In bargaining models, variation in leadership preferences is expected to have a significant impact on ethno-territorial conflict outcomes. More extreme nationalist leaders and, more conditionally, strongly power-seeking leaders, should be more likely to be willing to use force to modify the status quo – although more moderate nationalist leaderships are also willing to do so under certain conditions. In five case studies, these formally derived hypotheses receive initial empirical support.\u0000\u0000\u0000Originality/value\u0000Theoretically and empirically, further refinement of research on variation in leadership preferences promises to add significant value. Formally, it is worth investigating the expected impact of additional preference types. Empirically, it is important to invest in measures of leadership preferences across large samples.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-10-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-07-2019-0070","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49525381","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-18DOI: 10.1108/igdr-08-2019-0090
H. Mohtadi, Bryan S. Weber
Purpose The proliferation of terrorism worldwide raises the risk that terrorist strategies could evolve from conventional methods (e.g. suicide attacks) to biological, chemical and even radioactive and nuclear attacks (commonly abbreviated as CBRN) which are potentially much more dangerous. The authors make three contributions toward a better understanding of this risk and how it responds to counterterrorism measures. Design/methodology/approach The authors develop a game that captures the terrorists’ potential strategic substitution between conventional and CBRN-type attacks; the authors calibrate the parameters of the game to real data using a novel calibration method and a partially unique dataset; they estimate the heavy-tailed distribution of attack severity and thus the probability of a successful attack, the underlying effort to launch an attack and the intrinsic difficulty of launching different types of attacks. Findings The authors find that in equilibrium, CBRN attacks, though less likely and more difficult to execute, are more deadly. In the end, the trade-off between, on one hand, the greater difficulty of carrying out a CBRN attack, and on the other, the greater deadliness of such an attack, points to a level of optimal counterterrorism spending by governments that weighs toward defending against CBRN attacks. The authors discuss these results and compare them with the actual level of counterterrorism spending by the US Government. Originality/value The framework of the game allows for substitution between the conventional and CBRN weapon types. These aspects of this paper, together with the unique calibration methodology, and the use of some unique terrorism data for the first time, are what distinguish this work from similar game theoretic papers in this area.
{"title":"Terrorism risk and optimal policy response: theory and empirics","authors":"H. Mohtadi, Bryan S. Weber","doi":"10.1108/igdr-08-2019-0090","DOIUrl":"https://doi.org/10.1108/igdr-08-2019-0090","url":null,"abstract":"\u0000Purpose\u0000The proliferation of terrorism worldwide raises the risk that terrorist strategies could evolve from conventional methods (e.g. suicide attacks) to biological, chemical and even radioactive and nuclear attacks (commonly abbreviated as CBRN) which are potentially much more dangerous. The authors make three contributions toward a better understanding of this risk and how it responds to counterterrorism measures.\u0000\u0000\u0000Design/methodology/approach\u0000The authors develop a game that captures the terrorists’ potential strategic substitution between conventional and CBRN-type attacks; the authors calibrate the parameters of the game to real data using a novel calibration method and a partially unique dataset; they estimate the heavy-tailed distribution of attack severity and thus the probability of a successful attack, the underlying effort to launch an attack and the intrinsic difficulty of launching different types of attacks.\u0000\u0000\u0000Findings\u0000The authors find that in equilibrium, CBRN attacks, though less likely and more difficult to execute, are more deadly. In the end, the trade-off between, on one hand, the greater difficulty of carrying out a CBRN attack, and on the other, the greater deadliness of such an attack, points to a level of optimal counterterrorism spending by governments that weighs toward defending against CBRN attacks. The authors discuss these results and compare them with the actual level of counterterrorism spending by the US Government.\u0000\u0000\u0000Originality/value\u0000The framework of the game allows for substitution between the conventional and CBRN weapon types. These aspects of this paper, together with the unique calibration methodology, and the use of some unique terrorism data for the first time, are what distinguish this work from similar game theoretic papers in this area.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-10-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-08-2019-0090","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46781060","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-14DOI: 10.1108/igdr-08-2019-0084
Partha Gangopadhyay, Siddharth Jain
Purpose This paper aims to examine the interrelationships between subnational conflicts in Myanmar and other variables of interests from the following four major domains: economic, human security and vulnerability of people, aggressiveness or militancy of the armed forces and global and regional climates. Design/methodology/approach Autoregressive distributed lag (ARDL) bounds testing approach has been applied on annual data from 1960-2017, to deal with the problems of autocorrelation and non-stationarity of key variables. Findings First, an increase in crop yield, cereal productivity, food productivity and per capita availability of arable land unequivocally and significantly lower the severity of conflict in Myanmar in the long run. Second, the authors uncover strong evidence that the intensity of conflicts bears a positive relationship with the vulnerability of the people of Myanmar. Third, the authors detect that both regional and global climate variables have limited and rather inconsistent impacts on subnational conflicts in Myanmar. Finally, the authors find that the aggressiveness (militancy index) of the armed forces has significant impacts upon subnational conflicts and economic variables of Myanmar in the long run. Originality/value This paper is completely data-driven and explains the long-term dynamics of the intensity of the civil war in Myanmar. ARDL bounds testing approach has been used to examine the interrelationships between subnational conflicts in Myanmar and other variables of interests. It is a novel approach, which overcomes the problems of autocorrelation and nonstationarity and offers reliable results.
{"title":"Understanding subnational conflicts in Myanmar","authors":"Partha Gangopadhyay, Siddharth Jain","doi":"10.1108/igdr-08-2019-0084","DOIUrl":"https://doi.org/10.1108/igdr-08-2019-0084","url":null,"abstract":"\u0000Purpose\u0000This paper aims to examine the interrelationships between subnational conflicts in Myanmar and other variables of interests from the following four major domains: economic, human security and vulnerability of people, aggressiveness or militancy of the armed forces and global and regional climates.\u0000\u0000\u0000Design/methodology/approach\u0000Autoregressive distributed lag (ARDL) bounds testing approach has been applied on annual data from 1960-2017, to deal with the problems of autocorrelation and non-stationarity of key variables.\u0000\u0000\u0000Findings\u0000First, an increase in crop yield, cereal productivity, food productivity and per capita availability of arable land unequivocally and significantly lower the severity of conflict in Myanmar in the long run. Second, the authors uncover strong evidence that the intensity of conflicts bears a positive relationship with the vulnerability of the people of Myanmar. Third, the authors detect that both regional and global climate variables have limited and rather inconsistent impacts on subnational conflicts in Myanmar. Finally, the authors find that the aggressiveness (militancy index) of the armed forces has significant impacts upon subnational conflicts and economic variables of Myanmar in the long run.\u0000\u0000\u0000Originality/value\u0000This paper is completely data-driven and explains the long-term dynamics of the intensity of the civil war in Myanmar. ARDL bounds testing approach has been used to examine the interrelationships between subnational conflicts in Myanmar and other variables of interests. It is a novel approach, which overcomes the problems of autocorrelation and nonstationarity and offers reliable results.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-10-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-08-2019-0084","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46416830","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-09DOI: 10.1108/igdr-11-2018-0115
R. Kumar, M. Paul
Purpose This study aims to estimate total factor productivity (TFP) growth for the post-2008 period for selected industries in the manufacturing sector at NIC 3-digit. Total factor productivity growth (TFPG) estimates are based on the theoretical framework provided by studies such Hall (1988), Abraham et al. (2009) and Crepon et al. (2005) that incorporate market imperfection in labour and product market, thereby modifying the traditional TFP estimation as Solow Residual. Design/methodology/approach Based on the theoretical model that incorporates market imperfections in labour as well as product market in modifying the TFP estimates using the Levinsohn–Petrin framework of empirical estimation, the authors have calculated industry wise TFPG for 62 industries at NIC 3-digit level. Findings The study finds three distinct trends: first, there are considerable industrial disparities in productivity growth in terms of TFP. The estimates have been found to be higher than the conventional Solow Residual for most industries, indicating the role played by market imperfections in affecting the conventional measure of productivity growth. Second, estimates of bargaining power are found to be lower than those compared to the earlier estimates in Maiti (2013) for the Indian organised manufacturing case for 1998-2005. This observation is commensurate with the observation in recent years of a falling share in labour wage in total output in organised manufacturing sector. Finally, the study also found a statistically significant contribution of greater mechanisation on TFPG while an adverse effect of the rising dependence of organised manufacturing on contractual labour. Originality/value The role of market imperfections in measuring TFPG has been undertaken, and it has been found to be an important factor, as the estimated measures vary from the conventional measures of TFPG. Moreover, the study has considered a very recent period from 2008-2015 in estimating TFPG, as well as analysing the factors behind the trends in TFPG at industrial level.
{"title":"Industry level analysis of productivity growth under market imperfections","authors":"R. Kumar, M. Paul","doi":"10.1108/igdr-11-2018-0115","DOIUrl":"https://doi.org/10.1108/igdr-11-2018-0115","url":null,"abstract":"\u0000Purpose\u0000This study aims to estimate total factor productivity (TFP) growth for the post-2008 period for selected industries in the manufacturing sector at NIC 3-digit. Total factor productivity growth (TFPG) estimates are based on the theoretical framework provided by studies such Hall (1988), Abraham et al. (2009) and Crepon et al. (2005) that incorporate market imperfection in labour and product market, thereby modifying the traditional TFP estimation as Solow Residual.\u0000\u0000\u0000Design/methodology/approach\u0000Based on the theoretical model that incorporates market imperfections in labour as well as product market in modifying the TFP estimates using the Levinsohn–Petrin framework of empirical estimation, the authors have calculated industry wise TFPG for 62 industries at NIC 3-digit level.\u0000\u0000\u0000Findings\u0000The study finds three distinct trends: first, there are considerable industrial disparities in productivity growth in terms of TFP. The estimates have been found to be higher than the conventional Solow Residual for most industries, indicating the role played by market imperfections in affecting the conventional measure of productivity growth. Second, estimates of bargaining power are found to be lower than those compared to the earlier estimates in Maiti (2013) for the Indian organised manufacturing case for 1998-2005. This observation is commensurate with the observation in recent years of a falling share in labour wage in total output in organised manufacturing sector. Finally, the study also found a statistically significant contribution of greater mechanisation on TFPG while an adverse effect of the rising dependence of organised manufacturing on contractual labour.\u0000\u0000\u0000Originality/value\u0000The role of market imperfections in measuring TFPG has been undertaken, and it has been found to be an important factor, as the estimated measures vary from the conventional measures of TFPG. Moreover, the study has considered a very recent period from 2008-2015 in estimating TFPG, as well as analysing the factors behind the trends in TFPG at industrial level.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-10-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-11-2018-0115","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43081092","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-09DOI: 10.1108/igdr-08-2019-0087
V. Borooah, A. Tagat, V. Mishra
Purpose The purpose of this paper is to provide a quantitative assessment of caste-based conflict in India. The data for this paper are from the Rural Economic and Demographic Survey (REDS) of 2006 encompassing 8,659 households in 242 villages in 18 Indian states. Design/methodology/approach Using these data, the authors examine two broad issues: the sources of conflict in rural India and the degree to which these sources contribute to caste-basted, as opposed to non-caste-based conflict; the sources of conflict resolution in rural India: are some conflict-resolving agencies more effective at dealing with caste-based conflicts and others more effective with non-caste-based conflicts? Findings There was a rise in caste-based conflict over the (approximate) period 1996-2006. There are several reasons for the rise in caste-based conflict but, in the main, is the rise in assertiveness of persons belonging to India’s lower castes. In terms of conflict resolution, panchayats and prominent individuals were important in resolving village conflicts: 69 per cent of caste-based, and 65 per cent of non-caste based, conflicts were resolved by one or the other of these two agents. Originality/value This is the first attempt, using econometric methodology, to study caste conflict at a village level in India.
{"title":"Conflict, caste and resolution: a quantitative analysis for Indian villages","authors":"V. Borooah, A. Tagat, V. Mishra","doi":"10.1108/igdr-08-2019-0087","DOIUrl":"https://doi.org/10.1108/igdr-08-2019-0087","url":null,"abstract":"\u0000Purpose\u0000The purpose of this paper is to provide a quantitative assessment of caste-based conflict in India. The data for this paper are from the Rural Economic and Demographic Survey (REDS) of 2006 encompassing 8,659 households in 242 villages in 18 Indian states.\u0000\u0000\u0000Design/methodology/approach\u0000Using these data, the authors examine two broad issues: the sources of conflict in rural India and the degree to which these sources contribute to caste-basted, as opposed to non-caste-based conflict; the sources of conflict resolution in rural India: are some conflict-resolving agencies more effective at dealing with caste-based conflicts and others more effective with non-caste-based conflicts?\u0000\u0000\u0000Findings\u0000There was a rise in caste-based conflict over the (approximate) period 1996-2006. There are several reasons for the rise in caste-based conflict but, in the main, is the rise in assertiveness of persons belonging to India’s lower castes. In terms of conflict resolution, panchayats and prominent individuals were important in resolving village conflicts: 69 per cent of caste-based, and 65 per cent of non-caste based, conflicts were resolved by one or the other of these two agents.\u0000\u0000\u0000Originality/value\u0000This is the first attempt, using econometric methodology, to study caste conflict at a village level in India.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-10-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-08-2019-0087","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47232612","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-09DOI: 10.1108/igdr-01-2019-0008
B. S. Misra
Purpose This paper aims to compute total factor productivity (TFP) growth for India as well as for its 19 major states and to explore the determinants of TFP at the state level by considering the spillover effects. Design/methodology/approach TFP growth has been obtained using growth accounting equation. Further, the TFP growth estimates were used to derive TFP levels using the translog index procedure. Given the policy focus on building infrastructure and expanding financial access, we have estimated the impact of irrigation, electricity, road, health, education and financial depth on TFP using the Spatial Durbin Model to account for spillover effects. Findings Computing TFP growth for two sub periods, namely, 2001-2008 and 2009-2015, the study finds a deterioration in TFP growth for India as well as for 10 of the 19 states under study in the post global financial crisis period. The author find that TFP is positively impacted by irrigation, health and road infrastructure. While financial depth and education were statistically insignificant, installed capacity of electricity had a negative impact on state level TFP. Research limitations/implications 'The author provides rationale for the empirical findings considering the country context. The findings of this study act as pointers for shaping higher growth on a sustained basis in India. The study helps to assess the productivity growth in the new states, namely, Jharkhand, Chhattisgarh and Uttarakhand, that were carved out in 2000 vis a vis their parent states. This assessment is useful especially for the states of Jharkhand and Chhattisgarh which were created to address economic backwardness in certain pockets of the parent states. Originality/value First, it provides TFPG estimates for India as well as 19 major states during the 2000-2015 period. Second, this study helps to understand how TFPG for India as well as each of the 19 states have behaved in the post global financial crisis period. Third, the study helps to assess the productivity growth in the three newly created states in 2000 vis a vis their parent states. Fourth, this is the first attempt which considers the spatial interdependence among the states to estimate the impact of financial and infrastructural development on productivity in the Indian states.
{"title":"Determinants of total factor productivity in Indian states","authors":"B. S. Misra","doi":"10.1108/igdr-01-2019-0008","DOIUrl":"https://doi.org/10.1108/igdr-01-2019-0008","url":null,"abstract":"\u0000Purpose\u0000This paper aims to compute total factor productivity (TFP) growth for India as well as for its 19 major states and to explore the determinants of TFP at the state level by considering the spillover effects.\u0000\u0000\u0000Design/methodology/approach\u0000TFP growth has been obtained using growth accounting equation. Further, the TFP growth estimates were used to derive TFP levels using the translog index procedure. Given the policy focus on building infrastructure and expanding financial access, we have estimated the impact of irrigation, electricity, road, health, education and financial depth on TFP using the Spatial Durbin Model to account for spillover effects.\u0000\u0000\u0000Findings\u0000Computing TFP growth for two sub periods, namely, 2001-2008 and 2009-2015, the study finds a deterioration in TFP growth for India as well as for 10 of the 19 states under study in the post global financial crisis period. The author find that TFP is positively impacted by irrigation, health and road infrastructure. While financial depth and education were statistically insignificant, installed capacity of electricity had a negative impact on state level TFP.\u0000\u0000\u0000Research limitations/implications\u0000'The author provides rationale for the empirical findings considering the country context. The findings of this study act as pointers for shaping higher growth on a sustained basis in India. The study helps to assess the productivity growth in the new states, namely, Jharkhand, Chhattisgarh and Uttarakhand, that were carved out in 2000 vis a vis their parent states. This assessment is useful especially for the states of Jharkhand and Chhattisgarh which were created to address economic backwardness in certain pockets of the parent states.\u0000\u0000\u0000Originality/value\u0000First, it provides TFPG estimates for India as well as 19 major states during the 2000-2015 period. Second, this study helps to understand how TFPG for India as well as each of the 19 states have behaved in the post global financial crisis period. Third, the study helps to assess the productivity growth in the three newly created states in 2000 vis a vis their parent states. Fourth, this is the first attempt which considers the spatial interdependence among the states to estimate the impact of financial and infrastructural development on productivity in the Indian states.\u0000","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-10-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-01-2019-0008","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43863598","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-09-23DOI: 10.1108/igdr-04-2017-0033
D. Gupta
Purpose In this paper, the author develops a game theoretical model to understand why Union Government of India, as a third party, has used different schemes at different times in history to assist the State Governments in fighting the Naxalite insurgency. Comparing across schemes, it was found that though Matching Security Grants scheme was preferred in general, during asymmetric information scenario it led to an emergency situation wherein the Union Government had to provide the less preferred Bulk Security Grants. Later, it became difficult to withdraw these grants as the State Governments free rode by reducing own security contribution. The author finds that instead, in this scenario, Matching Development Grants are more suitable, as they incentivize the State Governments to reveal private information and help the Union Government exit its third-party role. For a practitioner involved in conflict resolution, these conclusions imply that as the desirability of policies can change diametrically overtime, Union Government must spend resources only on those heads of expenditure that provide both security and development benefits provided they aid in preventing flow of resources to Naxalites. Further, to end its assistance, the Union Government’s expenditures should also complement the capabilities of the State Government rather than substituting them. These results can also guide policy in other protracted civil wars with substantial third-party intervention, which are common these days. Design/methodology/approach The paper is an historical analysis of strategies used by Union and State Governments and Naxalites. The analysis is based on game theoretic tools supported with examples. Findings The Union Government must provide matching grants instead of bulk grants such as Central Armed Police Forces, and the grants should be aimed at building complementarities with the state governments’ security contributions. Under asymmetric information scenario, the Union and State Governments reduce their expenses incurred to fight the Naxalites. A Matching Development Grants scheme would have done better. Union Government must spend resources on heads of expenditure that provides both Development and Security benefits, to curb flow of resources to Naxalites, besides complementing the Security Contributions of the State Government. Research limitations/implications The research is limited by disaggregated data to test the hypotheses. It is also limited by the data on hidden variables like the contribution of the Naxalites to fighting. The research is also limited to the extent that individual groups in the war like police commanders, politicians and Naxalite commanders are not incorporated. Multiple asymmetric parties are also not considered; that may generalize the model to other theaters of insurgency. Practical implications Certain heads of expenditure such as roads, mobile communication, improving quality of investigation, preventing human right
{"title":"Policies for resolving insurgencies – lessons from third-party intervention in India","authors":"D. Gupta","doi":"10.1108/igdr-04-2017-0033","DOIUrl":"https://doi.org/10.1108/igdr-04-2017-0033","url":null,"abstract":"\u0000Purpose\u0000In this paper, the author develops a game theoretical model to understand why Union Government of India, as a third party, has used different schemes at different times in history to assist the State Governments in fighting the Naxalite insurgency. Comparing across schemes, it was found that though Matching Security Grants scheme was preferred in general, during asymmetric information scenario it led to an emergency situation wherein the Union Government had to provide the less preferred Bulk Security Grants. Later, it became difficult to withdraw these grants as the State Governments free rode by reducing own security contribution. The author finds that instead, in this scenario, Matching Development Grants are more suitable, as they incentivize the State Governments to reveal private information and help the Union Government exit its third-party role. For a practitioner involved in conflict resolution, these conclusions imply that as the desirability of policies can change diametrically overtime, Union Government must spend resources only on those heads of expenditure that provide both security and development benefits provided they aid in preventing flow of resources to Naxalites. Further, to end its assistance, the Union Government’s expenditures should also complement the capabilities of the State Government rather than substituting them. These results can also guide policy in other protracted civil wars with substantial third-party intervention, which are common these days.\u0000\u0000\u0000Design/methodology/approach\u0000The paper is an historical analysis of strategies used by Union and State Governments and Naxalites. The analysis is based on game theoretic tools supported with examples.\u0000\u0000\u0000Findings\u0000The Union Government must provide matching grants instead of bulk grants such as Central Armed Police Forces, and the grants should be aimed at building complementarities with the state governments’ security contributions. Under asymmetric information scenario, the Union and State Governments reduce their expenses incurred to fight the Naxalites. A Matching Development Grants scheme would have done better. Union Government must spend resources on heads of expenditure that provides both Development and Security benefits, to curb flow of resources to Naxalites, besides complementing the Security Contributions of the State Government.\u0000\u0000\u0000Research limitations/implications\u0000The research is limited by disaggregated data to test the hypotheses. It is also limited by the data on hidden variables like the contribution of the Naxalites to fighting. The research is also limited to the extent that individual groups in the war like police commanders, politicians and Naxalite commanders are not incorporated. Multiple asymmetric parties are also not considered; that may generalize the model to other theaters of insurgency.\u0000\u0000\u0000Practical implications\u0000Certain heads of expenditure such as roads, mobile communication, improving quality of investigation, preventing human right","PeriodicalId":42861,"journal":{"name":"Indian Growth and Development Review","volume":" ","pages":""},"PeriodicalIF":1.4,"publicationDate":"2019-09-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/igdr-04-2017-0033","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48147072","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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