IDEAS home Printed from https://ideas.repec.org/a/eee/jcecon/v39y2011i4p499-513.html
   My bibliography  Save this article

Tariff liberalization and trade specialization: Lessons from India

Author

Listed:
  • Alessandrini, Michele
  • Fattouh, Bassam
  • Ferrarini, Benno
  • Scaramozzino, Pasquale

Abstract

This paper analyzes the effects of policy reform on the structure of India’s trade in manufactures, from 1990 to 2006. It computes comparative advantage indicators on the basis of disaggregated trade flow data and assesses the effects of trade liberalization on the evolution of India’s pattern of trade specialization. Industries where import tariffs have been reduced the most have experienced the highest increase in specialization. Moreover, trade liberalization has helped India improve its comparative advantage in industries with medium- to high-technology content, as well as in some of the industries enjoying the most robust growth in global demand. Liberalization policies have been instrumental in enhancing the international competitiveness of industries.

Suggested Citation

  • Alessandrini, Michele & Fattouh, Bassam & Ferrarini, Benno & Scaramozzino, Pasquale, 2011. "Tariff liberalization and trade specialization: Lessons from India," Journal of Comparative Economics, Elsevier, vol. 39(4), pages 499-513.
    • Handle: RePEc:eee:jcecon:v:39:y:2011:i:4:p:499-513
    DOI: 10.1016/j.jce.2011.03.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0147596711000199
    Download Restriction: Full text for ScienceDirect subscribers only

    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. Panagariya, Arvind, 2011. "India: The Emerging Giant," OUP Catalogue, Oxford University Press, number 9780199751563.
    2. Kochhar, Kalpana & Kumar, Utsav & Rajan, Raghuram & Subramanian, Arvind & Tokatlidis, Ioannis, 2006. "India's pattern of development: What happened, what follows?," Journal of Monetary Economics, Elsevier, vol. 53(5), pages 981-1019, July.
    3. Poonam Gupta & Rana Hasan & Utsav Kumar, 2008. "What Constrains Indian Manufacturing?," Macroeconomics Working Papers 22162, East Asian Bureau of Economic Research.
    4. Dr. Mitsuyo ANDO & Dr. Fukunari Kimura, 2009. "Fragmentation in East Asia: Further Evidence," Working Papers DP-2009-20, Economic Research Institute for ASEAN and East Asia (ERIA).
    5. Prema-chandra Athukorala & Jayant Menon, 2010. "Global Production Sharing, Trade Patterns and Determinants of Trade Flows," Departmental Working Papers 2010-06, The Australian National University, Arndt-Corden Department of Economics.
    6. Andrew B. Bernard & Stephen J. Redding & Peter K. Schott, 2007. "Comparative Advantage and Heterogeneous Firms," Review of Economic Studies, Oxford University Press, vol. 74(1), pages 31-66.
    7. Mitsuyo Ando & Fukunari Kimura, 2005. "The Formation of International Production and Distribution Networks in East Asia," NBER Chapters,in: International Trade in East Asia, NBER-East Asia Seminar on Economics, Volume 14, pages 177-216 National Bureau of Economic Research, Inc.
    8. Chamarbagwala, Rubiana & Sharma, Gunjan, 2011. "Industrial de-licensing, trade liberalization, and skill upgrading in India," Journal of Development Economics, Elsevier, vol. 96(2), pages 314-336, November.
    9. Sivadasan Jagadeesh, 2009. "Barriers to Competition and Productivity: Evidence from India," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 9(1), pages 1-66, September.
    10. Devashish Mitra & Beyza Ural, 2009. "Indian manufacturing: A slow sector in a rapidly growing economy," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 18(1), pages 205-205.
    11. Petia Topalova & Amit Khandelwal, 2011. "Trade Liberalization and Firm Productivity: The Case of India," The Review of Economics and Statistics, MIT Press, vol. 93(3), pages 995-1009, August.
    12. Pattnayak, Sanja S. & Thangavelu, S.M., 2005. "Economic reform and productivity growth in Indian manufacturing industries: an interaction of technical change and scale economies," Economic Modelling, Elsevier, vol. 22(4), pages 601-615, July.
    13. Kunal Sen, 2009. "International Trade and Manufacturing Employment: Is India following the Footsteps of Asia or Africa?," Review of Development Economics, Wiley Blackwell, vol. 13(4), pages 765-777, November.
    14. Michele Alessandrini & Bassam Fattouh & Pasquale Scaramozzino, 2007. "The changing pattern of foreign trade specialization in Indian manufacturing," Oxford Review of Economic Policy, Oxford University Press, vol. 23(2), pages 270-291, Summer.
    15. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
    16. Robert Stehrer & Julia Woerz, 2009. "Industrial Diversity, Trade Patterns, and Productivity Convergence," Review of Development Economics, Wiley Blackwell, vol. 13(2), pages 356-372, May.
    17. Yilmaz Akyüz, 2011. "Export Dependence and Sustainability of Growth in China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 19(1), pages 1-23, January.
    18. Juan Carlos Hallak & Peter K. Schott, 2011. "Estimating Cross-Country Differences in Product Quality," The Quarterly Journal of Economics, Oxford University Press, vol. 126(1), pages 417-474.
    19. Yue, Changjun & Hua, Ping, 2002. "Does comparative advantage explains export patterns in China?," China Economic Review, Elsevier, vol. 13(2-3), pages 276-296.
    20. Joseph Francois & Hanna Norberg & Miriam Manchin, 2008. "Trade Impact Assessment of an EU-India Free Trade Agreement," IIDE Discussion Papers 20080601, Institue for International and Development Economics.
    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. Benno Ferrarini & Pasquale Scaramozzino, 2013. "Complexity, Specialization and Growth," CEIS Research Paper 275, Tor Vergata University, CEIS, revised 30 Apr 2013.
    2. Mukherjee, Subhadip & Chanda, Rupa, 2017. "Differential effects of trade openness on Indian manufacturing firms," Economic Modelling, Elsevier, vol. 61(C), pages 273-292.
    3. Nihar Shembavnekar, 2015. "Tariff Liberalisation, Labour Market Flexibility and Employment: Evidence from India," Working Paper Series 8115, Department of Economics, University of Sussex Business School.
    4. Bhatt, Antra & Scaramozzino, Pasquale, 2013. "Federal Transfers and Fiscal Discipline in India: An Empirical Evaluation," ADB Economics Working Paper Series 343, Asian Development Bank.
    5. Nupur Bang & Sougata Ray & Kavil Ramachandran, 2018. "Family Businesses: The Emerging Landscape 1990 - 2015," Working Papers id:12750, eSocialSciences.
    6. Ohlan, Ramphul, 2014. "Competitiveness and Trade Performance of India’s Dairy Industry," Asian Journal of Agriculture and Development, Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA), vol. 11(2), pages 1-22, December.
    7. Mallick, Sushanta & Marques, Helena, 2016. "Pricing strategy of emerging market exporters in alternate currency regimes: The role of comparative advantage," International Review of Economics & Finance, Elsevier, vol. 45(C), pages 68-81.
    8. repec:taf:jitecd:v:25:y:2016:i:8:p:1071-1089 is not listed on IDEAS
    9. Baiardi, Donatella & Bianchi, Carluccio & Lorenzini, Eleonora, 2015. "The price and income elasticities of the top clothing exporters: Evidence from a panel data analysis," Journal of Asian Economics, Elsevier, vol. 38(C), pages 14-30.
    10. Benno Ferrarini & Pasquale Scaramozzino, 2015. "The Product Space Revisited: China's Trade Profile," The World Economy, Wiley Blackwell, vol. 38(9), pages 1368-1386, September.
    11. Ferrarini, Benno & Scaramozzino, Pasquale, 2016. "Production complexity, adaptability and economic growth," Structural Change and Economic Dynamics, Elsevier, vol. 37(C), pages 52-61.
    12. Kathuria, Vinish & Rajesh Raj, S.N. & Sen, Kunal, 2013. "The effects of economic reforms on manufacturing dualism: Evidence from India," Journal of Comparative Economics, Elsevier, vol. 41(4), pages 1240-1262.
    13. Matthew Embrey & Guillaume R. Frechette & Sevgi Yuksel, 2016. "Cooperation in the Finitely Repeated Prisoner's Dilemma," Working Paper Series 8616, Department of Economics, University of Sussex.
    14. Woong Lee, 2017. "Trade Liberalization and the Aggregate Matching Function in India," Asian Economic Papers, MIT Press, vol. 16(1), pages 120-137, Winter/Sp.

    More about this item

    Keywords

    Asia; India; Trade; Liberalization; Specialization;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

    Statistics

    Access and download statistics

    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:eee:jcecon:v:39:y:2011:i:4:p:499-513. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/inca/622864 .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.