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Economic Liberalization and the Vintages of Machinery Imports in Developing Countries: An Empirical Test for India's Imports from the United Kingdom

  • Homi Katrak
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    This paper examines whether India's liberalization of machinery and machine tools since the mid-1980s has led to the use of more recent vintages and/or better quality equipment. Empirical tests compare the weight-adjusted unit values of India's imports with those of China, and also of the USA and Germany. Regression analyses use the five-digit and eight-digit SITC data of imports of those countries from the UK. For each of three years (1987, 1994 and 1996), India's weight-adjusted unit values were lower than those of the other countries. Further, over that 9-year period, the gap between India's unit values and those of the others did not decrease. A possible explanation is that India's reforms have not yet had sufficient time to have an effect and that this may require that enterprises undertake a greater effort to search for more recent vintages and also develop the technological capabilities and skills required for their use.

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    Article provided by Taylor & Francis Journals in its journal Oxford Development Studies.

    Volume (Year): 28 (2000)
    Issue (Month): 3 ()
    Pages: 309-322

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    Handle: RePEc:taf:oxdevs:v:28:y:2000:i:3:p:309-322
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