European Business Schools Librarian's Group

Working Papers,
Copenhagen Business School, Department of International Economics and Management

No 2-2001: Market Reforms and Industrial Productivity: An Explanation

Murali Patibandla and B.V. Phani
Additional contact information
Murali Patibandla: Department of International Economics and Management, Copenhagen Business School, Postal: Department of International Economics and Management, Copenhagen Business School, Howitzvej 60, 2nd floor , DK-2200 Copenhagen N, Denmark
B.V. Phani: Department of International Economics and Management, Copenhagen Business School, Postal: Department of International Economics and Management, Copenhagen Business School, Howitzvej 60, 2nd floor , DK-2200 Copenhagen N, Denmark

Abstract: The recent developments in the new growth theory shows the theoretical link between industrial productivity and market mechanism in terms of private agents’ incentives for investing in research and development and human capital accumulation. Several developing economies, such as India, that had implemented policy reforms towards market mechanism have been experiencing high economic growth. This paper brings out the factors that determine micro level firm level productivity in the context of a developing economy that had undertaken the policy reforms towards a freer market. It econometrically tests a few hypotheses on the basis of firm level panel data for a set of Indian industries. One of the strong results of the paper is that firm level outward orientation of exports and imports contributes significantly and positively to firm level productivity. This finding supports one of the propositions of the new growth theory that developing economies benefit significantly with free trade with developed economies through free flow of new ideas and technologies and externalities.

Keywords: growth theory; R&D investment; human capital accumulation; developing economies; India; policy reforms; free markets

15 pages, June 1, 2001

Full text files

6527 PDF-file 

Download statistics

Questions (including download problems) about the papers in this series should be directed to Lars Nondal ()
Report other problems with accessing this service to Sune Karlsson ().

This page generated on 2024-02-12 04:36:27.