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Article
Publication date: 11 October 2019

Ramaa Arun Kumar and Mahua Paul

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…

Abstract

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.

Details

Indian Growth and Development Review, vol. 13 no. 1
Type: Research Article
ISSN: 1753-8254

Keywords

Article
Publication date: 1 February 2002

Bruce D. Keillor, G. Tomas M. Hult and Deborah Owens

A number of obstacles, many originating from political/government sources, adversely affect individual firms involved in operations outside of their domestic market. The purpose…

Abstract

A number of obstacles, many originating from political/government sources, adversely affect individual firms involved in operations outside of their domestic market. The purpose of this study was to investigate the role in which market access, existence of government policies, and market imperfections impact both the importance firms attach to, and the formalization of, political activities designed to reduce or eliminate such threats. The findings indicate, when faced with government/political threats, firms attach high levels of importance to political behaviors and this, in turn, is associated with formalized political activities on the part of the firm.

Details

International Journal of Commerce and Management, vol. 12 no. 2
Type: Research Article
ISSN: 1056-9219

Article
Publication date: 28 February 2023

Pramod Chandra

Drawing on the extant literature that suggests marketing imperfections are an opportunity to create and establish a foundation for sustainable entrepreneurial prospects and…

Abstract

Purpose

Drawing on the extant literature that suggests marketing imperfections are an opportunity to create and establish a foundation for sustainable entrepreneurial prospects and sustainability, this study aims to delineate a marketing mix strategy for Indian medicinal and aromatic plant (MAP) resources to optimize the benefits derived from their existing MAP business and address its marketing imperfections.

Design/methodology/approach

A case study research design was used to investigate the MAP sector, and 37 in-depth interviews were conducted to collect the primary data. Given the study’s exploratory nature, an inductive approach was used for data analysis, and conventional qualitative content analysis was performed to analyze the data.

Findings

The findings reveal that a marketing mix strategy is relevant for linking MAP businesses to the country’s sustainable livelihood options, entrepreneurial prospects, resource management and the economy and for improving the sector’s global competitive position.

Originality/value

To the best of the author’s knowledge, this study is the first to explore and present a marketing mix strategy for Indian MAP resources. Thus, it extends the marketing and entrepreneurship literature regarding natural resource businesses to advance sustainable entrepreneurial prospects and sustainability. The study concludes by offering strategic clues for implementing the marketing mix strategy in the Indian MAP sector and businesses.

Details

Journal of Research in Marketing and Entrepreneurship, vol. 25 no. 3
Type: Research Article
ISSN: 1471-5201

Keywords

Article
Publication date: 8 November 2013

Rana Hasan, Devashish Mitra and Asha Sundaram

This study aims to focus on the role of labor regulation and credit market imperfections, in addition to that of factor endowments, in determining capital intensities in Indian…

1165

Abstract

Purpose

This study aims to focus on the role of labor regulation and credit market imperfections, in addition to that of factor endowments, in determining capital intensities in Indian manufacturing.

Design/methodology/approach

The paper considers an alternative approach to identifying the effects of India ' s labor regulations on industrial performance. In particular, the paper uses a measure of the stringency of labor regulations across countries – one that is completely independent of the India-specific measures used by earlier studies – and examines its relationship with capital intensities across manufacturing industries. Additionally, since labor regulations are unlikely to be the only reason for imperfections in factor markets, the paper also examines whether and to what extent capital market imperfections affect capital intensities across manufacturing industries. The paper then presents a case study that seeks to ascertain whether actual capital intensities prevailing in Indian manufacturing in major industry groups from 1989 to 1996 were larger than predicted capital intensities for these industry groups based on relative factor demand functions estimated for the USA (a country with relatively less restrictive labor laws and a more developed financial system) evaluated at Indian wages. Finally, the paper uses a recently available dataset to compare capital intensities in Indian and Chinese manufacturing to investigate the behavior of these two emerging Asian economies since 1980, when they started out with relatively similar socio-economic conditions.

Findings

The paper finds that India uses more capital-intensive techniques of production in manufacturing than countries at similar levels of development (and similar factor endowments), including China. For a majority of manufacturing industries, labor freedom and capital market development are, in addition to factor endowments, important determinants of capital intensity of production techniques used. Results reveal that, controlling for factor prices, India specializes in more capital-intensive varieties within broad industry groups relative to the USA, a more capital-abundant economy.

Originality/value

To the best of the authors ' knowledge, such a study has not been done for any other country. The paper sheds light on the important issue regarding the use of capital-intensive techniques in manufacturing in India, which is a labor-abundant country. The role of labor regulation has been extensively debated and the paper also investigates its role along with the role played by credit market imperfections.

Details

Indian Growth and Development Review, vol. 6 no. 2
Type: Research Article
ISSN: 1753-8254

Keywords

Article
Publication date: 15 February 2013

Kashif Rashid and Sardar M.N. Islam

The purpose of this paper is to test the role of corporate governance instruments in affecting the value of a firm (CGVF) in isolation and in combination of each other in a

2051

Abstract

Purpose

The purpose of this paper is to test the role of corporate governance instruments in affecting the value of a firm (CGVF) in isolation and in combination of each other in a developing financial market characterized by the existence of additional imperfections in this market.

Design/methodology/approach

Multiple regression analysis is performed on the data which are collected by using stratified random sampling technique for the companies listed in the Kuala Lumpur Stock Exchange for the years 2000‐2003.

Findings

The results for the study suggest that majority shareholders expropriate minority shareholders in this market. On the contrary, a bigger board, market liquidity, efficient utilization of assets and informational efficiency in the financial system have a value adding impact on the firms' performance. The results on the role of corporate governance instruments (board size and CEO duality) in affecting the value of a firm in combination with each other suggest that the additional imperfections prevalent in the selected market limit the strength of individual instruments in improving the marginal benefits of each other, explaining the nature of business operations in this market.

Practical implications

The results provide new insights into the CGVF relationship and highlight the importance of corporate governance provisions relevant to the firms of the developing market. These results can be used by the regulatory authorities to make effective corporate governance policies.

Originality/value

This paper contributes to the literature by performing a comprehensive study by using a correct proxy to value a firm and by performing additional tests for robustness to provide valid results on the CGVF relationship. Furthermore, the role of additional imperfections and implications of various business theories in explaining the relationship between corporate governance instruments (in isolation and in combination) and the value of a firm is also analysed.

Details

Corporate Governance: The international journal of business in society, vol. 13 no. 1
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 1 March 1980

Elie Appelbaum and Eliakim Katz

In this paper we consider the effects of certain capital market imperfections on portfolio choice problems. We show that as a result of these imperfections, the distribution…

Abstract

In this paper we consider the effects of certain capital market imperfections on portfolio choice problems. We show that as a result of these imperfections, the distribution functions of rates of return may depend on portfolio allocation, thus leading to non‐convexities and consequently to patterns of specialisation rather than diversification.

Details

Journal of Economic Studies, vol. 7 no. 3
Type: Research Article
ISSN: 0144-3585

Book part
Publication date: 1 October 2014

Amr Sadek Hosny

A number of studies have examined the role of typical demand supply factors in explaining inflation. The contribution in this chapter is to investigate the possible role of…

Abstract

A number of studies have examined the role of typical demand supply factors in explaining inflation. The contribution in this chapter is to investigate the possible role of product market imperfections on inflation and inflation persistence, especially among emerging market economies. Using a backward-looking Phillips curve framework in a dynamic panel framework of 105 countries over the 2008–2011 period, our findings suggest that product market competition, as measured by the World Economic Forum’s measure of goods market imperfections do have a significant impact on inflation persistence. On average, higher competition and efficiency in product markets reduces the inflation persistence effect especially in the MENA region and countries at lower stages of development.

Details

Risk Management Post Financial Crisis: A Period of Monetary Easing
Type: Book
ISBN: 978-1-78441-027-8

Keywords

Article
Publication date: 1 January 1995

DAVID T. LLEWELLYN

Given the potential costs of regulation, the objectives and rationale of regulation need to be made clear. The paper argues that the ultimate rationale of regulation is not…

Abstract

Given the potential costs of regulation, the objectives and rationale of regulation need to be made clear. The paper argues that the ultimate rationale of regulation is not paternalistic but, in order to correct for market imperfections and failures, to offer consumers the benefits of economies of scale that can be derived from collective monitoring by a specialist regulator and to offer an assurance of minimum standards, regulation should be designed to correct for market imperfections and failures that potentially compromise consumer welfare. It is also argued that, when efficiently constructed, regulation and supervision reinforce competition and the efficiency of market mechanisms rather than impede them and that the ‘accountancy cost’ of regulation is an entirely misleading measure of the costs of regulation.

Details

Journal of Financial Regulation and Compliance, vol. 3 no. 1
Type: Research Article
ISSN: 1358-1988

Article
Publication date: 7 August 2017

Ambreen Fatima

The purpose of this paper is to explore the effect of globalization and credit market imperfections on child labour.

Abstract

Purpose

The purpose of this paper is to explore the effect of globalization and credit market imperfections on child labour.

Design/methodology/approach

Analysis is based on cross-country regression framework, incorporating 129 developing countries for the period 1970-2010.

Findings

The findings indicate that countries that are more open to trade and having higher foreign direct investment inflow have lower incidence of child labour. As child labour in export-related industries is hard to find, trade sanctions may not have a significant effect on child labour. Further study concludes that income of the bottom quartile of the population is the best representation of the income of the poor when studying child labour.

Research limitations/implications

The study uses the data compiled by International Labour Organization (ILO). Though much of the variation in the data is because of the adjustments made by ILO, this is the only comparable cross-country estimates available. Hence in the absence of the cross-country comparable estimates, many empirical studies have used this data set (e.g. Cigno et al., 2002; Dehejia and Gatti, 2002; Rogers and Swinnerton, 2001). This study acknowledges this limitation but again in the absence of any comparable estimates, the assessment is also based on this data set.

Originality/value

Study contributes in the literature by comparing the effect of export and trade and by exploring the effect of an alternate measure of the income, estimated by using Gini coefficient, on child labour. Further studies exploring the effect of globalization did not explore the presence of imperfect credit market, however, this study has explored the effect of credit market imperfections as well.

Details

International Journal of Social Economics, vol. 44 no. 8
Type: Research Article
ISSN: 0306-8293

Keywords

Book part
Publication date: 1 January 2006

Jongmoo Jay Choi and Eric C. Tsai

Conventional foreign direct investment (FDI) theories regard FDIs as strategic moves based on operational or industrial organization considerations. We demonstrate that financial…

Abstract

Conventional foreign direct investment (FDI) theories regard FDIs as strategic moves based on operational or industrial organization considerations. We demonstrate that financial factors are also important in corporate FDI decisions. The financial factors concern internal capital market strength and corporate governance and include exchange rate changes, internal and external financing cost, risk diversification, and agency costs. There is variability in the significance of financial variables depending on industries and destinations. The integrated model with both strategic and financial factors is superior to either component model in explaining FDIs. However, financial factors are no less important in explaining the prevailing FDI phenomena than strategic or operational variables.

Details

Value Creation in Multinational Enterprise
Type: Book
ISBN: 978-1-84950-475-1

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