IDEAS home Printed from https://ideas.repec.org/a/spr/ijlaec/v61y2018i2d10.1007_s41027-018-0136-1.html
   My bibliography  Save this article

Trade Liberalisation, Capital-Intensive Export and Informalisation: A Case Study of India’s Manufacturing Sector

Author

Listed:
  • Sonal Ann D’souza

    (JNU)

  • Panchendra K. Naik

    (Centre for Development Studies (CDS))

Abstract

There has been widespread concern among the academicians regarding the changing composition of trade in the aftermath Washington Consensus regime, which enforced the structural adjustment programme among developing economies. The policy mantra of the regime was rested on “stabilize, privatize, and liberalize”—give market free rein strategy. Since then, there has been a systematic shift in developing economies’ trade basket towards capital- and skill-intensive products, and India was no exception. In this study, we have made an attempt to understand the changing dynamics of India’s manufacturing trade under the liberalised regime. In the last couple of decades, the country’s manufacturing export basket had shown rapid changes towards capital- and skill-intensive goods. These changes are, however, understood as India’s failure to specialise in its comparative advantage. Under the new global production structure, this poses a serious threat to the country as this marked shift has not resulted in labour absorption. This has further abetted the process of informalisation—as we noticed more employment across the export-led industries gradually shifting towards the unorganised informal sector. The growing informalisation of the economy should be understood from the prism of global production structure that uses cheap labour from developing economies by infusing a dangerous obsession for competition.

Suggested Citation

  • Sonal Ann D’souza & Panchendra K. Naik, 2018. "Trade Liberalisation, Capital-Intensive Export and Informalisation: A Case Study of India’s Manufacturing Sector," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 61(2), pages 377-399, June.
    • Handle: RePEc:spr:ijlaec:v:61:y:2018:i:2:d:10.1007_s41027-018-0136-1
    DOI: 10.1007/s41027-018-0136-1
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s41027-018-0136-1
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s41027-018-0136-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Amit K Bhandari & Almas Heshmati, 2008. "Wage Inequality and Job Insecurity Among Permanent and Contract Workers in India: Evidence from Organized Manufacturing Industries," The IUP Journal of Applied Economics, IUP Publications, vol. 0(1), pages 80-111, January.
    2. Felipe, Jesus & Kumar, Utsav & Abdon, Arnelyn, 2013. "Exports, capabilities, and industrial policy in India," Journal of Comparative Economics, Elsevier, vol. 41(3), pages 939-956.
    3. Lall, Sanjaya, 2001. "Competitiveness Indices and Developing Countries: An Economic Evaluation of the Global Competitiveness Report," World Development, Elsevier, vol. 29(9), pages 1501-1525, September.
    4. Paul Krugman & Robert Lawrence, 1993. "Trade, Jobs, and Wages," NBER Working Papers 4478, National Bureau of Economic Research, Inc.
    5. Dani Rodrik, 2006. "Goodbye Washington Consensus, Hello Washington Confusion? A Review of the World Bank's Economic Growth in the 1990s: Learning from a Decade of Reform," Journal of Economic Literature, American Economic Association, vol. 44(4), pages 973-987, December.
    6. Krugman, Paul, 1983. "New Theories of Trade among Industrial Countries," American Economic Review, American Economic Association, vol. 73(2), pages 343-347, May.
    7. Gene M. Grossman & Elhanan Helpman, 1993. "Innovation and Growth in the Global Economy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262570971, December.
    8. repec:ilo:ilowps:370120 is not listed on IDEAS
    9. Sanjaya Kumar Malik, 2015. "Measurement of Technological Change in India’s Textile Machinery Industry Using the Malmquist Productivity Index," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 9(2), pages 179-203, May.
    10. Bishwanath Goldar & Suresh Chand Aggarwal, 2012. "Informalization Of Industrial Labor In India: Effects Of Labor Market Rigidities And Import Competition," The Developing Economies, Institute of Developing Economies, vol. 50(2), pages 141-169, June.
    11. Bishwanath Goldar, 2009. "Impact of Trade on Employment Generation in Manufacturing in India," Trade Working Papers 22921, East Asian Bureau of Economic Research.
    12. Roy, Satyaki, 2007. "Structural change in employment in India since 1980s: How Lewisian is it?," MPRA Paper 18009, University Library of Munich, Germany, revised 2008.
    13. Stiglitz, Joseph E, 1996. "Some Lessons from the East Asian Miracle," The World Bank Research Observer, World Bank, vol. 11(2), pages 151-177, August.
    14. William MILBERG, 2004. "The changing structure of trade linked to global production systems: What are the policy implications?," International Labour Review, International Labour Organization, vol. 143(1-2), pages 45-90, March.
    15. Milberg, William S.,, 2004. "The changing structure of international trade linked to global production systems : what are the policy implications?," ILO Working Papers 993701203402676, International Labour Organization.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jagannath Mallick, 2020. "Does Global Economic Integration affect Labour Income Share in India?," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 63(2), pages 291-309, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Benhassine, Najy & Raballand, Gaël, 2009. "Beyond ideological cleavages: A unifying framework for industrial policies and other public interventions," Economic Systems, Elsevier, vol. 33(4), pages 293-309, December.
    2. Marion Payen & Patrick Rondé, 2020. "Culture, Institutions and Economic Growth," Working Papers of BETA 2020-18, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    3. Dutta, Sourish, 2017. "Mechanics of Global Value chains: India’s Perspective," EconStor Preprints 235156, ZBW - Leibniz Information Centre for Economics.
    4. Saon Ray & Smita Miglani, 2018. "Upgrading in the Indian automobile sector: The role of lead firms," Indian Council for Research on International Economic Relations (ICRIER) Working Paper 360, Indian Council for Research on International Economic Relations (ICRIER), New Delhi, India.
    5. Dutta, Sourish, 2016. "A Review of Literature of Global Value Chains," MPRA Paper 106206, University Library of Munich, Germany.
    6. repec:ilo:ilowps:413008 is not listed on IDEAS
    7. Hayter, Susan., 2005. "The social dimension of global production systems : a review of the issues," ILO Working Papers 993749973402676, International Labour Organization.
    8. Daria Taglioni & Deborah Winkler, 2016. "Making Global Value Chains Work for Development," World Bank Publications - Books, The World Bank Group, number 24426, December.
    9. Kosacoff, Bernardo & López, Andrés & Pedrazzoli, Mara, 2008. "Trade, investment and fragmentation of the global market: is Latin America lagging behind?," Estudios y Perspectivas – Oficina de la CEPAL en Buenos Aires 39, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    10. Saon Ray & Smita Miglani, 2020. "India's GVC integration: An analysis of upgrading efforts and facilitation of lead firms," Indian Council for Research on International Economic Relations (ICRIER) Working Paper 386, Indian Council for Research on International Economic Relations (ICRIER), New Delhi, India.
    11. Chiliatto-Leite, Marcos Vinicius, 2021. "Constrained integration in Latin America: analysis based on a twenty-first-century centre-periphery vision," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    12. Kalim SIDDIQUI, 2016. "The Political Economy of Free Trade, WTO and the Developing Countries," Turkish Economic Review, KSP Journals, vol. 3(1), pages 103-121, March.
    13. Staritz, Cornelia, 2012. "Value chains for development? Potentials and limitations of global value chain approaches in donor interventions," Working Papers 31, Austrian Foundation for Development Research (ÖFSE).
    14. Österreichische Forschungsstiftung für Internationale Entwicklung (ÖFSE) (ed.), 2013. "Österreichische Entwicklungspolitik 2013. Private Sector Development: Ein neuer Businessplan für Entwicklung?," Austrian Development Policy Report, Austrian Foundation for Development Research (ÖFSE), number 268192.
    15. Reinhard Schumacher, 2013. "Deconstructing the Theory of Comparative Advantage," World Economic Review, World Economics Association, vol. 2013(2), pages 1-83, February.
    16. Shyam Sundar, K.R., 2011. "Non-regular workers in India : social dialogue and organizational and bargaining strategies and practices," ILO Working Papers 994665563402676, International Labour Organization.
    17. Ernst, Christoph. & Sánchez-Ancochea, Diego., 2008. "Offshoring and employment in the developing world : the case of Costa Rica," ILO Working Papers 994130083402676, International Labour Organization.
    18. James Heintz, 2014. "Jobs, Justice and Development: A Review of Working Hard, Working Poor," Development and Change, International Institute of Social Studies, vol. 45(4), pages 799-811, July.
    19. Alessandro Nicita & Victor Ognivtsev & Miho Shirotori, 2013. "Global Supply Chains: Trade And Economic Policies For Developing Countries," UNCTAD Blue Series Papers 55, United Nations Conference on Trade and Development.
    20. Sanjaya Lall, 2013. "Reinventing Industrial Strategy: The Role Of Government Policy In Building Industrial Competitiveness," Annals of Economics and Finance, Society for AEF, vol. 14(2), pages 785-829, November.
    21. Mulatu, Abay, 2016. "On the concept of 'competitiveness' and its usefulness for policy," Structural Change and Economic Dynamics, Elsevier, vol. 36(C), pages 50-62.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:ijlaec:v:61:y:2018:i:2:d:10.1007_s41027-018-0136-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.