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India's specialisation in IT exports: Offshoring can't defy gravity

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  • Meyer, Thomas

Abstract

India’s actual export specialisation in IT services is unrivalled by any comparable country and it is evidence of a strong comparative advantage. This paper finds that India owes its IT specialisation in part to its reliance on offshoring - driven by the supply of well-educated, English-speaking and affordable workers - but also to a shift away from high-tech manufacturing exports. Going forward, India's specialisation on IT and other high-tech exports may decline as rising wages erode one of the reasons for offshoring.

Suggested Citation

  • Meyer, Thomas, 2007. "India's specialisation in IT exports: Offshoring can't defy gravity," MPRA Paper 5780, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:5780
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    References listed on IDEAS

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    1. Baldwin, Richard & Robert-Nicoud, Frédéric, 2007. "Offshoring: General Equilibrium Effects on Wages, Production and Trade," CEPR Discussion Papers 6218, C.E.P.R. Discussion Papers.
    2. Ronald W. Jones, 2000. "A Framework for Fragmentation," Tinbergen Institute Discussion Papers 00-056/2, Tinbergen Institute.
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    6. G. Rajan, Raghuram, 2006. "India: The Past and Its Future," Asian Development Review, Asian Development Bank, vol. 23(2), pages 36-52.
    7. Jagdish Bhagwati & Arvind Panagariya, 2004. "The Muddles over Outsourcing," Journal of Economic Perspectives, American Economic Association, vol. 18(4), pages 93-114, Fall.
    8. Meyer, Thomas, 2006. "Offshoring to new shores: Nearshoring to Central and Eastern Europe," MPRA Paper 5785, University Library of Munich, Germany.
    9. 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.
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    Cited by:

    1. Eduardo Fernández-Arias & Charles Sabel & Ernesto H. Stein & Alberto Trejos, 2016. "Two to Tango: Public-Private Collaboration for Productive Development Policies," IDB Publications (Books), Inter-American Development Bank, number 94716, February.
    2. Mukherjee, Sanchita, 2009. "Technology intensity of Indian merchandise exports," MPRA Paper 35694, University Library of Munich, Germany.
    3. Ricardo Rozemberg & Daniela Ramos & Andrés López & Juan Carlos Hallak & Andrea González & Roberto Bisang, 2014. "Public-Private Collaboration on Productive Development Policies in Argentina," IDB Publications (Working Papers) 84496, Inter-American Development Bank.
    4. Rozemberg, Ricardo & Ramos, Daniela & López, Andrés & Hallak, Juan Carlos & González, Andrea & Bisang, Roberto, 2014. "Public-Private Collaboration on Productive Development Policies in Argentina," IDB Publications (Working Papers) 6410, Inter-American Development Bank.
    5. Wim Naudé & Riaan Rossouw, 2011. "Export diversification and economic performance: evidence from Brazil, China, India and South Africa," Economic Change and Restructuring, Springer, vol. 44(1), pages 99-134, April.
    6. Fernández-Arias, Eduardo & Sabel, Charles & Stein, Ernesto H. & Trejos, Alberto, 2016. "Two to Tango: Public-Private Collaboration for Productive Development Policies," IDB Publications (Books), Inter-American Development Bank, number 7694, March.
    7. Johan Fourie & Dieter von Fintel, 2009. "World Rankings of Comparative Advantage in Service Exports," Working Papers 03/2009, Stellenbosch University, Department of Economics.
    8. Richa Khurana & D. K. Nauriyal, 2017. "Dynamics of Services Exports in India," Millennial Asia, , vol. 8(2), pages 178-193, October.

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    More about this item

    Keywords

    International trade; comparative advantage; offshoring; India;
    All these keywords.

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • F1 - International Economics - - Trade
    • F47 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Forecasting and Simulation: Models and Applications

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