Tariff liberalization and firm-level markups in Indian manufacturing

Mukherjee, Subhadip; Chanda, Rupa

doi:10.1016/j.econmod.2021.105594

Cited by 15 publications

(8 citation statements)

References 37 publications

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“…Therefore, a potential extension of the current research would be to examine the optimal import and hedging decision for such firms under exchange rate uncertainty in a twomoment decision model. ORCID Subhadip Mukherjee https://orcid.org/0000-0002-7540-8989 Soumyatanu Mukherjee https://orcid.org/0000-0003-0674-1064 Mamata Parhi https://orcid.org/0000-0003-4024-0431 Kun Duan https://orcid.org/0000-0003-3897-4081 Ahmed Usman https://orcid.org/0000-0001-5223-4149 ENDNOTES 1 This period comprises India's most important and significant tariff reform policy changes aiming at micro & SME firms (MSME firms hereafter), viz., rounds of 1997-2003 and that of the 2004-2009 phase (Mukherjee & Chanda, 2021). 2 These firms are often exposed to foreign markets only with respect to the imports of intermediate inputs and are mostly operating domestically.…”

Section: Discussionmentioning

confidence: 99%

“…Following Mukherjee and Chanda (2021) and Dai and Cheng (2018) we estimate firm-level mark-up using the following two steps:…”

Section: Estimation Of Firm-level Markupmentioning

confidence: 99%

“…1 1 This period comprises India's most important and significant tariff reform policy changes aiming at micro & SME firms (MSME firms hereafter), viz., rounds of 1997–2003 and that of the 2004–2009 phase (Mukherjee & Chanda, 2021). …”

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confidence: 99%

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A risk–return trade‐off or co‐movement? Are food processing firms risk‐averse?

Mukherjee

Parhi

et al. 2023

Int. J Fin Econ

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We build a two‐moment decision‐theoretic framework to study how firms in the food‐processing industry negotiate between risk and return while relying on imported inputs for production at an intensive margin. Two possibilities emerge: either a co‐movement or a trade‐off in risk and return under various industry and economic conditions. Building on our theoretical setting, we design a testable empirical framework that considers a panel of 316 firms in the Indian food‐processing industry between 1993 and 2009. We find strong evidence of a decrease in the absolute risk aversion preference, although the magnitude varies measurably across firms.

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Section: Discussionmentioning

confidence: 99%

“…Following Mukherjee and Chanda (2021) and Dai and Cheng (2018) we estimate firm-level mark-up using the following two steps:…”

Section: Estimation Of Firm-level Markupmentioning

confidence: 99%

See 1 more Smart Citation

A risk–return trade‐off or co‐movement? Are food processing firms risk‐averse?

Mukherjee

Parhi

et al. 2023

Int. J Fin Econ

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“…It facilitates access to knowledge and technology and expands the range of goods and services available to consumers (e.g., Aggarwal et al, 2022;Defever et al, 2020;Grossman and Helpman, 2015;Porteous, 2020). It also enhances export upgrading (e.g., Bas and Strauss-Kahn, 2015;Mukherjee and Chanda, 2021;Saadi, 2020). Reduction in per-unit trade costs lowers export-market prices for low-costs exporters relative to high-costs exporters, and allows low-cost exporters to gain market shares at the detriment of high-cost exporters (e.g., Sørensen, 2014).…”

Section: Theoretical Discussion On the Effect Of Aft Flows On The Inf...mentioning

confidence: 99%

Do Aid for Trade Flows Help Reduce the Shadow Economy in Recipient Countries?

Gnangnon

2022

Preprint

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The present analysis has assessed the effect of Aid for Trade (AfT) flows on the shadow economy using an unbalanced panel dataset of 106 countries over the period from 2002 to 2015. Empirical results obtained by means of the two-step system generalized method of moments, show that higher AfT flows are associated with a fall in the size of the shadow economy, with less developed countries experiencing a greater negative effect of AfT flows on the shadow economy than relatively advanced countries among recipient countries of AfT flows. AfT interventions reduce the size of the shadow economy in countries that face high trade costs as well as in those that experience a depreciation of the real exchange rate. Finally, AfT interventions reduce the size of the shadow economy in countries that improve economic sophistication.

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“…On another note, Gnangnon (2018) has provided empirical evidence that AfT interventions (including both total AfT and each of its three categories) are associated with greater trade policy liberalization in the recipient countries. On the other side, trade liberalization reduces the costs of the imported intermediate inputs and promotes export upgrading (e.g., Bas and Strauss-Kahn, 2015;Defever et al, 2020;Mukherjee and Chanda, 2021), and more specifically export complexity (e.g., Saadi, 2020), including by facilitating the diffusion of knowledge and transfer of technology (e.g., Grossman and Helpman, 2015). As a result, we can argue that by promoting trade policy liberalization (i.e., reducing trade costs, including both tariffs and trade-related nontariff costs),…”

Section: Aft Interventions For Economic Infrastructure and The Interv...mentioning

confidence: 99%

Effect of AfT flows on Investment-Oriented Remittances flows

GNANGNON

2022

Preprint

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Despite the voluminous literature on the effect of Aid for Trade (AfT) flows on recipient countries' trade performance, little is known about the relationship between AfT flows and other capital flows to developing countries. This paper contributes to the literature by exploring the effect of AfT inflows on investment-oriented remittances inflows, notably through the channel of trade costs. Using an unbalanced panel dataset of 106 countries over the period 2002–2019, and the two-step system generalized method of moments, the empirical analysis has established several outcomes. AfT flows exert a positive effect on investment-oriented remittances flows, with the magnitude of this positive effect being higher in Least developed countries than in other countries, and in remittance-dependent countries. AfT flows stimulate investment-oriented remittances flows in countries that face higher trade costs. Finally, total AfT flows reduce investment-oriented remittances flows in countries that experience a higher volatility of the overall trade costs, but boost investment-oriented remittances in countries that improve the quality of trade measures. The analysis shows that AfT flows could be an important leverage for stimulating investment-oriented remittances flows, and promote the development of the private sector in beneficiary countries.

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Tariff liberalization and firm-level markups in Indian manufacturing

Cited by 15 publications

References 37 publications

A risk–return trade‐off or co‐movement? Are food processing firms risk‐averse?

A risk–return trade‐off or co‐movement? Are food processing firms risk‐averse?

Do Aid for Trade Flows Help Reduce the Shadow Economy in Recipient Countries?

Effect of AfT flows on Investment-Oriented Remittances flows

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