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Price and income elasticity of Indian exports—The role of supply-side bottlenecks

Mehdi Raissi and Volodymyr Tulin

The Quarterly Review of Economics and Finance, 2018, vol. 68, issue C, 39-45

Abstract: This paper estimates the short-term and long-run price and income elasticity of Indian exports, and investigates the role of supply-side bottlenecks in shaping India’s export demand relationship. We use disaggregated export volume data for 45 Indian industries over the period 1990–2013, as well as industry-specific international relative prices, for estimation. Our results indicate that Indian exports are sensitive to international relative-price competitiveness, world demand, and energy shortages. In addition, binding supply-side constraints (notably energy shortages) dampen price responsiveness in the short-term.

Keywords: India; Export demand; Manufacturing; Income and price elasticity; Energy shortages (search for similar items in EconPapers)
JEL-codes: C23 F14 O14 O24 (search for similar items in EconPapers)
Date: 2018
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DOI: 10.1016/j.qref.2017.11.003

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