Uma S. Kambhampati

The persistence of profit differentials in Indian industry

The competitive process in a market economy is expected to work to eliminate profit differentials between firms/industries in the long run. In the Indian case, we note that quite a large number of industries experience above average profits that persist over time. Our analysis show that such persistence is higher in fast growing industries with high strategic barriers. On the other hand, government controls seem to be very effective in discouraging such persistence.

Role of Parental Literacy in Explaining Gender Difference: Evidence from child Schooling in India

Using the WIDER data-set from rural West Bengal, this article examines gender differences in child schooling, using indicators of school enrolment and attainment at the primary level. Among various factors studied, there is only weak evidence that characteristics of the older siblings and household resource constraint can explain this observed gender difference. There is, however, significant evidence that paternal and maternal education explain gender differences in both school enrolment and attainment: while fathers education has a significant impact on both boys and girls education at the primary level, mothers literacy has greater impact on the chances of daughters being educated than sons. In other words, when mothers have bargaining power, in this case via education, they are likely to increase collective household welfare rather than to perpetuate discriminatory practices.

Gender and Life Satisfaction in the UK

Abstract This contribution analyzes the variations in reported life satisfaction for men and women in the United Kingdom. While average levels of life satisfaction are similar for men and women, the variations in life satisfaction are more marked for women. Analyzing the British Household Panel Survey (BHPS) for 1996–2007, the paper finds that hours of paid work increase life satisfaction for both men and women, while housework hours are statistically significant only for retired men and women. Childcare (for children ages 3 to 4 years) and caring for adults affect womens life satisfaction negatively but are statistically insignificant for men. Some of these differences might be explained by the fact that women and men in the sample assign differing weights to satisfaction with different life dimensions. Job satisfaction, in particular, matters much more to men than to women.

Disciplining firms:The impact of trade reforms on profit margins in Indian industry

The paper analyses the effects of increased trade exposure on the profitability of firms in Indian industry. While trade reforms are often expected to decrease profit margins as firms struggle to compete in international markets, there is the possibility that increased competition may improve firm efficiency and provide a positive impetus to firm profitability. This paper is different from many others in this area in that it considers both these possibilities. An efficiency index is created to directly analyse the impact of changing efficiency levels on firm profit margins. Results indicate that liberalization significantly influenced profit margins. However, its main effect is through the impact that it has had on other firm variables - market shares, advertising, R&D and exports - all of which changed after 1991. While exports have had a pro-competitive effect on profit margins in the selected sample, AD and R&D both cause an increase in profit margins. It is also found that neither capital nor managerial capabilities (as proxied by remuneration) are particularly effective in increasing profit margins.

The 'Nowhere' Children: Patriarchy and the Role of Girls in India's Rural Economy

Abstract This paper analyses the contribution that girls make to the rural economy in India through their involvement in the labour market as well as in household chores. We model this in the context of the very different institutional and familial arrangements for girl children prevalent in different parts of India. Analysing the determinants of these activities within a multivariate probit model, we find that the best possible outcome for girls is in districts with high female literacy because here the probability of schooling increases and the probability of work decreases. Less satisfactory but still acceptable outcomes arise in districts where the female labour participation is high. Our results also show that the presence of very young siblings in the household worsens the probability of girls going to school or even working. The presence of older female siblings improves the chances of schooling while that of older male siblings increases the probability of girls doing household chores.

The software industry and development: the case of India

Software and globalization provide both opportunities and challenges to developing countries. Whether these opportunities are successfully utilized depends upon the availability of infrastructure and educational skills, a conclusion arrived at by many development debates over the past few decades. We will consider the impact of the software industry on development, drawing on the case of India. We show that in India, a number of factors have come together to contribute to the success of this industry, in spite of relatively poor infrastructure and education levels. In this case, however, the inadequacy of infrastructure and education have manifested themselves in an uneven spread of the benefits of this industry, leading to enclave-type development in urban centres in the southern and western parts of the country. While this is improving, the government has to take an active role to ensure a more even spread of the benefits accruing from this industry.

Farm-level performance of genetically modified cotton: a frontier analysis of cotton production in Maharashtra

In this paper, the yield increases resulting from the cultivation of Bt cotton in Maharashtra, India, are analysed. The study relies on commercial farm, rather than trial, data and is among the first of its kind to be based on real farm and market conditions. Findings show that since its commercial release in 2002, Bt cotton has had a significant positive impact on yields and on the economic performance of cotton growers in Maharashtra. This difference remains even after controlling for different soil and insecticide inputs in the production of Bt cotton. There is also significant spatial and temporal variation in this‘benefit’, and much depends upon where production is taking place and on the season.

Trade Reforms and the Efficiency of Firms in India

In this paper, we analyse the impact of reforms on manufacturing efficiency in India. The sector chosen--the cotton textile industry in India--is a very large employer and exporter and also has considerable historical significance. Its response to the reforms therefore is being watched with some concern. The paper concludes that while there was considerable dispersion in efficiency levels before the reforms, this dispersion has decreased since the reforms. To analyse this, we estimate a best practice frontier for the industry and then measure efficiency as the distance from this frontier. We find that efficiency has increased because the reforms have influenced other factors such as market shares, exports and imports and capital-labour ratios. Our results also indicate that geography--the location of the firm within a state and its proximity to a major urban centre--influences the efficiency levels of firms within it.

Industry competitiveness: leadership identity and market shares

Industry competitiveness is analysed by considering the stability of leadership positions across industries over time. Unlike earlier studies of competition which have concentrated solely on market shares the paper begins by establishing the significance of both the changes in market shares and the identity of market leaders in reflecting industry competitiveness. To do this, the identity, and market shares, of industry leaders is mapped out, across 11 years and 32 industries in India. It was found that market leaders are very stable in 12 industries but are relatively less stable in 20 industries. When they are stable, market shares are an adequate reflection of competitiveness but when they are not, leadership identity also becomes significant. A dummy variable of proxy for leadership stability is then constructed. Modelling leadership stability using this proxy, it was found that industry profitability, economies of scale and industry growth are all significant determinants.

Liberalization and labour: The fate of retrenched workers in the cotton textile industry in India

In 1991 the Indian government began to tread seriously the path of liberalization. It started to open up the economy, discuss the privatization of the public sector, invite foreign investment and reform the labour market. Liberalization has proved to be highly controversial. While there has been considerable debate about the consequences for labour, there have been few empirical studies of the effects so far. This paper intends to address this lacuna by focusing on the case of retrenched workers in the cotton textile industry. Our argument is fourfold. First, it cannot be assumed that the informal sector can readily absorb a sudden localized surge in unemployment. Second, even where retrenched workers have found employment in the informal sector, their conditions of employment in terms of wages, working hours, health and safety and representation are likely to be worse. Third, the National Renewal Fund has not been effective as a social safety-net for retrenched workers nor as a mechanism for regenerating industry. Finally, it cannot be assumed that the trade unions will be able to negotiate a satisfactory deal for redundant workers. These points are explored through an investigation into retrenched workers in the cotton textile mills of Ahmedabad, Gujarat state.