Are reforms productive? Explaining productivity and efficiency in the Indian manufacturing

Marie-Ange Véganzonès, Arup Mitra and Chandan Sharma

No 201233, Working Papers from CERDI

Abstract: India’s economic liberalization in the 1990s provides scope for research on the effect of policy reforms on economic performance. This paper addresses the question of some of these policy changes and their impact on firms’ productivity and efficiency. We test specifically the role of export, import (total, intermediary and capital goods), R&D, technology transfer and infrastructure endowment over the period 1994-2008. Result of the analysis suggests that infrastructure is a crucial determinant of manufacturing performance in India. This is true for a wide range of variables such as transport, energy and information & communication technology (ICT). This result is important in the Indian context of infrastructure bottlenecks. Empirical results also suggest that knowledge transfers through exports are more important than through imports. Other findings indicate that R&D is not a productivity-enhancing activity in India and that firms rely more on purchase of foreign technology. This outcome does not come as a surprise because Indian firms are known for low in-house research and innovation-oriented activities.

JEL-codes: D24 F43 H54 L60 O3 O53 (search for similar items in EconPapers)
Pages: 36
Date: 2012
New Economics Papers: this item is included in nep-eff and nep-ino
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Related works:
Working Paper: Are Reforms Productive? Explaining Productivity and Efficiency in the Indian Manufacturing (2013)
Working Paper: Are Reforms Productive? Explaining Productivity and Efficiency in the Indian Manufacturing (2013)
Working Paper: Are Reforms Productive? Explaining Productivity and Efficiency in the Indian Manufacturing (2013)
Working Paper: Are Reforms Productive? Explaining Productivity and Efficiency in the Indian Manufacturing (2012)
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