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Manufacturing Exports and Policy Formulations

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  • Satya Prasad Padhi

Abstract

The paper follows a methodology where exports are seen as the endogenous outcome of cost reduction practices in the domestic economy characterized by greater industrial differentiation and specialization; it is this competitiveness in the domestic environment that guides exports and induces the support bases such as infrastructure, human capital formation, R&D, etc., not the other way around. On the other hand, the actual behaviours of Indian manufacturing exports (and productivity growth) could be seen as mere (passive) adjustments to demand conditions created by liberalization of trade (exchange rate adjustments), which shifts the focus to an analysis of as to why big corporate firms, despite evidence of periodic productivity growth, could not sustain exports growth (and productivity growth). The focus then is on the nature of productivity growth. Lack of exports could be due to the fact that the observed productivity growth in India could be a reflection of increasing returns to scale phenomenon that (i) takes place with given technology (and endowments, preferences, etc., remain the same) and (ii) could be associated with higher market power, reducing export competitiveness.

Suggested Citation

  • Satya Prasad Padhi, 2013. "Manufacturing Exports and Policy Formulations," Foreign Trade Review, , vol. 48(2), pages 267-273, May.
    • Handle: RePEc:sae:fortra:v:48:y:2013:i:2:p:267-273
    DOI: 10.1177/0015732513481661
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    References listed on IDEAS

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    1. A. P. Thirlwall, 2015. "A Model of Regional Growth Rate Differences on Kaldorian Lines," Palgrave Studies in the History of Economic Thought, in: Essays on Keynesian and Kaldorian Economics, chapter 12, pages 286-301, Palgrave Macmillan.
    2. Young, Allyn A., 1928. "Increasing Returns and Economic Progress," History of Economic Thought Articles, McMaster University Archive for the History of Economic Thought, vol. 38, pages 527-542.
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    Cited by:

    1. Satya Prasad Padhi, 2018. "Importance of Employment Growth: A Perspective on Technological Progress," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 61(2), pages 401-409, June.
    2. Satya Prasad Padhi, 2024. "Indian Experience of Managing Impossible Trinity, Growth and Possible Tradeoff Between FDI and FIIs: Nature of Capital Inflows Matter," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 16(1), pages 44-63, January.

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    More about this item

    Keywords

    Exports; productivity growth; division of labour;
    All these keywords.

    JEL classification:

    • F00 - International Economics - - General - - - General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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