Imports , exports , and industrial performance in India , 1970-88

In the 1960's and 1970's, India's policy of encouraging self-sufficiency by restricting imports was complemented by regulation of all facets of the industrial environment. Still, India developed a large, diversified manufacturing sector. In 1977-78, the policy environment began to change - with a relaxing of import controls and restrictions that has continued until now. With reform of industrial policies and a more expansionary macroeconomic policy, the value added in manufacturing grew from 4.5 percent a year in the 1970's to 7.9 percent a year in the 1980's. Meanwhile, gradual depreciation of the currency since 1985 has encouraged exports and brought prices in India closer to world levels. The faster growth of output and productivity in the 1980's is a welcome change from India's earlier stagnation. But deteriorating macroeconomic balances have brought India to a balance of payments crisis. Changes in tariffs and other instruments have more than compensated for relaxation of the import regime. Foreign trade has contracted relative to domestic output, despite some relaxation of quantity restrictions and attempts to increase exports. The main reason for this decline has been the increase in import prices relative to domestic output because of increasing tariffs, large real devaluations (especially after 1986), and rapidly expnanding domestic demand, which have made the domestic market more attractive than exports. Policy reform has led to faster growth of manufacturing output and productivity, but the main force behind faster growth has been increased public spending fueled by growing fiscal deficits. Another important variable has been a more accommodating import policy sustained by large external borrowings. This pattern of growth is not sustainable because of significant internal and external debt stocks that have accumulated over the last decade. Macroeconomic and trade policy must change significantly to shift the economy to a more export-oriented path - both to overcome the foreign exchange shortages and to rely more on external demand for industrial output. The authors argue that the manufacturing sector is highly responsive to relative price changes. Pessimism about elasticity has pervaded Indian policy making but they show high elasticities, indicating that the economy would respond favorably to changes in incentives.Economic Theory&Research,Environmental Economics&Policies,TF054105-DONOR FUNDED OPERATION ADMINISTRATION FEE INCOME AND EXPENSE ACCOUNT,Consumption,Trade Policy

Who are the net food importing countries ?

The purpose of this paper is to update the information on net food importing countries, using different definitions of food, separating countries by their level of income, whether they are in conflict and whether they are significant oil exporters. The study also estimates the changes in net food importing status of these countries over the last two and a half decades, and, most important, the study measures the relative importance of these net food imports in the import basket of the countries. Our results show that while many low-income countries are net food importers, the importance and potential impact of the net food importing status has been highly exaggerated. Many low-income countries that have larger food deficits are either oil exporters or countries in conflict. Food deficits of most low-income countries are not that significant as a percentage of their imports. Our results also show that only 6 low-income countries have food deficits that are more than 10 percent of their imports. Last two decades have seen a significant improvement in the food trade balances of low-income developing countries. SSA low-income countries are an exception to this trend. On the other hand, there are a group of countries which are experiencing civil conflicts which are large importers of food, and these countries can not meet their basic needs. They also need special assistance in the distribution of food within their boundaries. Therefore, one should modify the WTO Ministerial Declaration, and focus on these conflict countries rather than the broad net food importers.Food&Beverage Industry,Emerging Markets,Currencies and Exchange Rates,Economic Theory&Research,

Mozambique Cashew reforms revisited

Cashew policy reforms in Mozambique have been controversial. They are often invoked by critics as an illustration of how agricultural policy reforms supported by international financial institutions may fail to have their intended effects. This paper revisits the reforms and their outcomes almost two decades later. While the reforms resulted in higher producer prices and an increase in output, lack of consensus on the specifics of the reforms and associated non-price support arrangements created a situation in which the sector was not able to withstand international price shocks that ultimately led to a collapse of both the processing industry and cashew production. Non-price support by donors improved the efficiency of the processing industry but this was not complemented by an expansion in cashew nut supply as such support did not extend to smallholder cashew producers. For the reforms to have had their intended results, greater investment in -- and support to -- smallholder production was needed to increase yields and overall output. Such a more comprehensive approach to cashew policy reform would have required a greater focus on achieving consensus on the causes of the cashew sector's problems and agreement by all stakeholders on a common institutional framework for pricing and non-price support.Markets and Market Access,Emerging Markets,Economic Theory&Research,Access to Markets,E-Business

Non-linearities and unit roots in G7 macroeconomic variables

We carry out a meta-analysis on the frequency of unit-roots in macroeconomic time series with a dataset covering 249 variables for the G7 countries. We use linear tests and the three popular non-linear tests (TAR, ESTAR and Markov Switching). In general, the evidence in favour of the random walk hypothesis is weaker than in previous studies. This evidence against unit roots is stronger for real and nominal asset prices. Our results show that rejection of the null of a unit root in the macro dataset is substantially higher for non-linear than linear models. Finally, the results from a Monte Carlo experiment show that rejection frequencies are very close to the nominal size of the test when the DGP is a linear unit root process. This leads us to reject the hypothesis that overfitting deterministic components explains the higher rejection frequencies of nonlinear tests

The evolution of agricultural trade flows

Earlier research showed that during the 1980s and 1990s most of the global agricultural trade expansion took place among the industrial countries and among countries within trade blocs. These were also periods of declining agricultural prices. These prices increased during the 2000s, there were continuous trade reforms, and many developing countries started to support their agricultural sectors. This paper analyzes trade flows during the past two decades, and tries to measure whether all these developments have changed the trade balances and the share of different groups within the global trade flows. In addition, it looks at the trade balances on food to see the impact of these changes on net food importing countries. In conclusion, unlike the case with manufacturing, developing countries have not been able to increase their export shares in agriculture as significantly. They have maintained their trade shares by primarily expanding exports to other developing countries.Emerging Markets,Food&Beverage Industry,Economic Theory&Research,Trade Policy,Free Trade

Towards a simplified taxonomy of Capsella bursa-pastoris (L.) Medik. (Brassicaceae)

Capsella bursa-pastoris (L.) Medik. is a species with a cosmopolitan distribution which shows considerable morphological variation. Numerous authors have recognised widely differing numbers of varieties, microspecies or other infraspecific subdivisions (segregates) of this species. In an attempt to clarify this situation, we grew British material of the species under controlled conditions through to the F) generation to remove environmental variation, and assessed the plants on the basis of a range of morphological criteria, namely leaf shape, capsule size and also length of time taken to flower. Analysis of these characteristics consistently produced four basic groups, which had been previously described. Herbarium specimens could also nearly always be assigned to one of these groups. Limited chromosome counts suggest that two of these groups are diploid and two are tetraploid. We suggest this fourfold division into broad groups reflects the major genetic separations within the species, but that there is also considerable phenotypic plasticity shown by C. bursapastoris in response to factors such as shade or trampling. These four groups appear to differ in their geographic.al distribution in Britain. KEYWORDS: Shepherd's Purse, morphological variation, leaf characters, capsule characters, chromosom

The role of services in rural income : the case of Vietnam

This paper investigates the role of services in the household response to trade reforms in Vietnam. The relative response of the households and income growth after a major trade liberalization in rice are analyzed aiming to answer the following questions: What type of households, in which locations, having access to what type of services, benefited more from the reforms? It focuses on services that have an impact on transaction costs (roads or quality of roads, public transportation, access to credit, extension services, and availability of markets in communication services) because transaction costs are often cited as a barrier to rural households in responding to the price changes and increased incentives offered by trade and other policy reforms. The results suggest that availability of production related services contributes positively to the impact of trade reforms. Although most of the service variables have a positive and significant effect on growth in income, some that are expected to have an impact are not significant. This may be explained by the exceptional coverage of infrastructure services in Vietnam even before the reforms. When service availability is very similar across different localities, household characteristics become more important in determining the response.Transport Economics Policy&Planning,Rural Poverty Reduction,Economic Theory&Research,Housing&Human Habitats

Protection and industrial structure in India

Effective protection rates in India are so high and vary so greatly that anything short of low uniform tariffs and the complete elimination of quantitative restrictions would not make the industrial incentive scheme transparent, as it needs to be. The authors produce evidence to show that there is ample scope for reducing tariffs and quantitative restrictions and that most industries could coexist with much less protection than they now have. By eliminating all surcharges on inputs (tariffs on imported inputs, price differentials on local inputs, nondeductible excise taxes) - even without correcting for the effects of high investment costs - most projects (including import substitution projects) would earn from current international prices a positive profit margin on their marginal as well as full production costs. The proportion of projects with a positive profit margin would triple, from 20 to 63 percent. Among import-substituting projects that are not candidates for export under the present trade regime, under the proposed new regime half would be candidates for export if they would procure their inputs at international prices. Lower tariffs would fulfill their primary purpose more effectively: providing protection and incentive signals. The function of generating public revenues, another critical issue in India, should be fulfilled not through tariffs but through more efficient and protection-neutral instruments - in particular direct taxation (income tax) and nontariff indirect taxation (neutral excise taxes, MODVAT, and preferably the value-added tax on consumption).Environmental Economics&Policies,Economic Theory&Research,Access to Markets,Markets and Market Access,Consumption

The Spermatophore in Glossina morsitans morsitans: Insights into Male Contributions to Reproduction.

Male Seminal Fluid Proteins (SFPs) transferred during copulation modulate female reproductive physiology and behavior, impacting sperm storage/use, ovulation, oviposition, and remating receptivity. These capabilities make them ideal targets for developing novel methods of insect disease vector control. Little is known about the nature of SFPs in the viviparous tsetse flies (Diptera: Glossinidae), vectors of Human and Animal African trypanosomiasis. In tsetse, male ejaculate is assembled into a capsule-like spermatophore structure visible post-copulation in the female uterus. We applied high-throughput approaches to uncover the composition of the spermatophore in Glossina morsitans morsitans. We found that both male accessory glands and testes contribute to its formation. The male accessory glands produce a small number of abundant novel proteins with yet unknown functions, in addition to enzyme inhibitors and peptidase regulators. The testes contribute sperm in addition to a diverse array of less abundant proteins associated with binding, oxidoreductase/transferase activities, cytoskeletal and lipid/carbohydrate transporter functions. Proteins encoded by female-biased genes are also found in the spermatophore. About half of the proteins display sequence conservation relative to other Diptera, and low similarity to SFPs from other studied species, possibly reflecting both their fast evolutionary pace and the divergent nature of tsetse's viviparous biology