A Baseline Measure for Post-Covid19 Export Performance: The Case of India

Adil Miankhel ()

Journal of Economic Development, 2024, vol. 49, issue 1, 73-96

Abstract: During crises, governments resort to extraordinary fiscal and financial measures and these policy choices along with aggregate demand and supply shocks affect the exporting environment of a country through many channels. Therefore, to analyze any post COVID pandemic inefficiencies, it is important to distinguish the already inherent inefficiencies in the exporting environment to provide a benchmark for comparative purposes. This study investigates the prevalence of inefficiencies in the exporting environment in India during the post GFC period (2010-18) using a stochastic frontier gravity model. The empirical analysis reveals that inefficiencies were already present in the post GFC period before the onset of COVID, which has increased over time. Using the data from the Economic Freedom Index, among other factors, the study found out that sound money dimension, including the November 2016 sudden implementation of the demonetization policy by the Indian Government was crucial in influencing India’s export efficiency.

Keywords: Exports; Inefficiency; Productivity; Stochastic Frontier Gravity Model; COVID; India; Potential Exports (search for similar items in EconPapers)
JEL-codes: E61 F14 F18 F41 F62 F63 F68 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:ris:jecdev:0081

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