Technology intensity of Indian merchandise exports

In the light of substantive improvement in the India’s export performance, this paper examines whether our exports have diversified to more technology intensive products. The analysis is focused mainly on merchandise export of India in the post liberalised period. The classification of merchandise export according to their technology intensity is based on OECD classification for the same. The analysis is done at 2-digit level for all commodities and at 3-digit level for some selected commodities. The study reveals that, India’s Export is dominated by medium-low technology intensive commodities. Export of low technology intensive is still prominent, while medium-high technology is showing signs of improvement, especially in recent periods. India has still to go long way, before making a mark in export of high technology intensive commodities.Technology exports; Merchandise Exports; Trends in Indian Exports; Technology Intensity

Does the level of capital openness explain “fear of floating” amongst the inflation targeting countries?

Abstract Under the assumption of perfect capital mobility, inflation targeting (IT) requires central banks to primarily focus on domestic inflation and to let their exchange rate float freely. This is consistent with the macroeconomic trilemma suggesting monetary independence, perfect capital mobility and a fixed exchange rate regime are mutually incompatible. However, some recent empirical evidence suggests that many developed and developing countries following an IT regime are reacting systematically both to deviations of inflation from its target and to exchange rates. I empirically examine whether the responsiveness of the interest rate to exchange rate fluctuations can be explained in terms of limited capital openness. Applying Arellano-Bond dynamic panel estimation method for 22 IT countries, I find that short-term interest rates do respond to real exchange rate fluctuations. However, the responsiveness of the interest rate to the exchange rate declines significantly as capital market openness increases. The results indicate that capital controls have a significant impact on the exchange rate policy of the IT central banks, as the central banks have relatively less control over the exchange rate movements with greater openness of the capital market.Macroeconomic Trilemma; Inflation Targeting; Interest Rates; Exchange Rate Policy; Capital Market Openness

The effects of capital market openness on exchange rate pass-through and welfare in an inflation-targeting small open economy

This paper analyzes the impact of capital market openness on exchange rate pass-through and subsequently on the social loss function in an inflation-targeting small open economy under a pure commitment policy. Applying the intuition behind the macroeconomic trilemma, the author examines whether a more open capital market in an inflation-targeting country improves the credibility of the central bank and consequently reduces exchange rate pass-through. First, the effect of capital openness on exchange rate pass-through is empirically examined using a new Keynesian Phillips curve. The empirical investigation reveals that limited capital openness leads to greater pass-through from the exchange rate to domestic inflation, which raises the marginal cost of deviation from the inflation target. This subsequently worsens the inflation output-gap trade-off and increases the social loss of the inflation targeting central bank under pure commitment. However, the calibration results suggest that the inflation output-gap trade-off improves and the social loss decreases even in the presence of larger exchange rate pass-through if the capital controls are effective at insulating the exchange rate from interest rate and risk-premia shocks.Monetary policy ; Inflation targeting ; Foreign exchange

Examining Farmer Suicides in India: A Study of Literature

Farmer’s suicides are not a phenomenon by itself; rather it is an extreme manifestation of the underlying agrarian crisis prevailing within the country for a long period of time. In recent time period this menace has turned out to be an epidemic, which has rocked the whole country. According to official records, around 160,000 farmers have committed suicide since 1997 (Vandana Shiva, 2008). These numbers are enough to pass a chill down the spine! Given these facts, this paper tries to trace out the major factors leading to such rural devastation on basis of the literatures available. According to literatures most affected states are: Maharashtra (Vidharbha), Andhra Pradesh (Telengana, Warrangal, Rayalaseema, etc), Karnataka (Northern Karnataka), Kerala (Wayanad) and Chhattisgarh. The reasons cited by the literatures highlights rural indebtedness as one of the major factor. Policies associated with the process of liberalisation imposed stress on peasantry of the country by withdrawing formal supports towards the sector, which in turn made farmers dependent on non-institutional sources such as private moneylenders and private agents. Seed sector liberalisation has not only brought private players in agriculture but also encouraged monoculture of hybrid cash crops requiring costly inputs, which eventually gets transformed into debt. This situation coupled with crop failure due to pest attack, climatic change and lack of irrigation led to mismatched expectation of farmers and indebtedness. Agonised farmers found solution to all these woes in the forbidden path of committing suicide.Agrarian Crisis; Farmer Suicide; Indian Agriculture; Agriculture Indebtedness; Farmers' Crisis

The effects of capital market openness on exchange rate pass-through and welfare in an inflation targeting small open economy

This paper analyzes the impact of capital market openness on exchange rate pass-through and subsequently on the social loss in an inflation targeting small open economy under a pure commitment policy. Applying the intuition behind the macroeconomic trilemma, I examine whether a more open capital market in an inflation targeting country improves the credibility of the central bank and consequently reduces exchange rate pass-through. First, I empirically examine the effect of capital openness on exchange rate pass-through using a New Keynesian Phillips curve. The empirical investigation reveals that limited capital openness leads to greater pass-through from the exchange rate to domestic inflation, which raises the marginal cost of deviation from the inflation target. This subsequently worsens the inflation output-gap trade-off and increases the social loss of the inflation targeting central bank under pure commitment. However, the calibration results suggest that the inflation output-gap trade-off improves and the social loss decreases even in the presence of larger exchange rate pass-through if the capital controls are effective at insulating the exchange rate from interest rate and risk-premia shocks.Monetary policy; Inflation Targeting; Exchange rate pass-through; Capital account openness; Small open economy

Dirty Signs in Clean Cities: On Trash as Socio-aesthetic Category in India

This _Article explores the intersection of urban beautification and caste in contemporary Indian cities, with specific focus on commissioned works of street art which are part of urban cleanliness campaigns. Over the past three decades, state-sponsored urban improvement schemes have aimed at eradicating perceived ‘dirt’ from cities, often employing street artists to promote urban beautification and cleanliness. Within the apparently inherent connection between beauty, sanitation and citizenship in Indian cities, an attempt at establishing an urban aesthetics of clean(s)ing is discernible, specifically in New Delhi. This _Article argues that the utilization of urban aesthetic practices like street art, particularly as a means to combat ‘dirt,’ emerges from caste-based and revanchist visions of the Indian public sphere. Through case studies, it shows how murals are employed to promote ideals of cleanliness that reflect upper-caste values that serve to transform urban spaces while policing oppressed-caste and working-class residents. Building on analyses of spatial transgression, such as Mary Douglas’ idea of dirt as “matter out of place,” Tim Cresswell’s notion of graffiti as “words out of place,” and D. Asher Ghertner’s concept of “aesthetic governmentality,” it explores the discursive procedures through which certain types of bodies and symbols are declared as illegal/illegible or dirty/disgusting in the Indian city. The _Article will show how street and other forms of art may embody and/or critique these prevalent notions of socio-spatial order