Supriyo De

MIGRATION AND REMITTANCES

This paper examines patterns of remittances among migrants from Guizhou province of China. Our research is motivated by three lines of theoretical arguments, namely the new economics of migration, a translocal perspective linking remittances and development, and the culture of remittances. Taking individual, household, and village-level characteristics into account, we estimated multilevel logistic models of the decision to remit and multilevel models of the amount of remittances. Our results show that migrant remittance behaviour is responsive to family needs as well as household economic position in the village. Migrants who come from entrepreneurial households are more likely to remit a large amount than other types of households. We find some evidence of ‘culture of remittances’ in these villages. Consistent with our expectations, migrants who are from villages with higher amounts of average remittances are likely to remit a larger amount than otherwise.

Impact of Intangible Capital on Productivity and Growth: Lessons from the Indian Information Technology Software Industry

This paper examines the impact of intangible capital, including human capital and organisational capabilities on productivity, using India as an illustrative example. The research breaks new ground in creating measures of intangible capital at a micro level. Measures of tangible and intangible capital are used to estimate a new economy production function with panel data. Generalised method of moments techniques are used to account for unobserved firm heterogeneity and endogenous explanatory variables. The results indicate that intangible assets have a major impact on software sector output. This has important implications for public policy and corporate strategy towards the information technology industry, including for Australia. Copyright

Intangible Determinants of Market Value in the New Economy: A Dynamic Panel Data Analysis of the Indian Software Industry

Intangible assets like human capital and organization capital have driven the success of Indias software industry. This article analyzes the impact of intangible assets on the market value of Indian software firms using a dynamic panel data model. Measures of tangible and intangible assets are constructed using firm-level panel data. The estimation technique uses system generalized method of moments (GMM) and minimum distance estimation (MDE). This methodology accounts for unobserved firm heterogeneity, endogenous explanatory variables and persistent variables. The results conclusively show that intangible assets have a significant impact on market values of Indian software firms.

Sovereign Ratings in the Post-Crisis World: An Analysis of Actual, Shadow and Relative Risk Ratings

This paper analyzes the evolution of sovereign credit ratings in the wake of the global financial crisis by studying changes in actual, shadow, and relative ratings between 2008 and 2012. For countries that do not have a rating from the major rating agencies, shadow ratings are estimated as a function of macroeconomic, structural, and governance variables. The shadow rating exercise confirms earlier findings in the literature that even after the financial crisis, many unrated countries appear to be more creditworthy than previously believed and can access international capital markets. The paper also develops a new rating scale called therelative risk rating,which ranks countries according to their actual or shadow ratings after controlling for changes in the world weighted average rating. When relative ratings in 2012 are compared with the first half of 2008, the world average rating is found to be weaker because of the financial crisis. The relative rating improved in developing economies such as Azerbaijan, Ethiopia, Kazakhstan, Indonesia, and the Philippines, whereas it deteriorated in crisis-affected high-income countries such as Cyprus, Greece, Spain, Portugal, Ireland, and Egypt. Interestingly, India, Jordan, Poland, and the United Kingdom had their rating outlook downgraded by the rating agencies, but their relative rating actually improved as other countries suffered even worse downgrades. A regression model is used to analyze the relative contributions of different variables to rating changes during 2008-2012, a helpful feature for policy makers interested in improving sovereign ratings.

Remittances Over the Business Cycle: Theory and Evidence

This paper examines the behavior of remittances over the business cycle and their potential to act as a stabilizer during periods of high business cycle volatility. Four main findings are reported. First, in theory, the cyclical behavior of remittances depends on the motives to remit. Second, remittances are less volatile than other foreign currency flows but do not appear to systemically co-move with business cycle fluctuations. Third, remittances are relatively stable even during episodes of sharp business cycle volatility, such as those associated with sudden stops and financial crises. Finally, remittances can help support consumption stability over the business cycle.