ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Ownership and Efficiency in Engineering Firms: 1990-91 to 1999-2000

The paper analyses the effect of ownership on efficiency of engineering firms in India in the 1990s, a decade of major economic reforms. Technical efficiency of firms, estimated with help of a stochastic frontier production function, is considered for the analysis. A comparison of technical efficiency is made among three groups of firms in Indian engineering: (i) firms with foreign ownership, (ii) domestically owned private sector firms, and (iii) public sector firms. The results clearly indicate that foreign firms in Indian engineering industry have higher technical efficiency than domestically owned firms. No significant difference in technical efficiency is found between private sector and public sector firms among the domestically owned firms. There are indications of a process of efficiency convergence - the domestically owned firms tending to catch up with foreign owned firms in terms of technical efficiency.

Impact of Japanese and US FDI on Productivity Growth

This paper examines the impact of Japanese and US foreign direct investments (FDI) on total factor productivity growth of firms in the Indian automobile, electrical and chemical industries in the post-reforms period. The results show that Japanese affiliation has a significant positive impact on productivity growth in a firm while the impact of US affiliation is not found to be significant. The results also show that domestic firms have witnessed both efficiency growth as well as technological progress in the electrical and chemical industries in the post-reforms period.

Local Wishes vs Social Costs

The classical theory of modernisation recognises only one path to modernity and the tendential disappearance of diversities during the last stage of the process. The development of Karur as an industrial district demonstrates how the spontaneous reproposal of processes that are well known in the European sphere, but which reflect systemic traditions strongly connected with a production system that is 'anchored' to quite definite localisms, highlights the existence of multiple modernities. One effect of this process is a general 'diffusion of possibilities' in the local social tissue for those who are able and know how to exploit them. The small units also manage to provide concrete answers to the problem of unemployment among the most disadvantaged social classes. Manifestations of the 'high road', that is the competition between the units based on the constant attempt to bring improvements to the products is evident; but so is thelow road' with high social costs: Precarious working conditions, exploitation of the workers, low cost labour, few innovations, relatively low quality of the products, environmental pollution.

Scale, Technology and Economies in Textile Power Processing

An attempt is made here to examine the interrelationship among scale, technology and other economic characters in the Indian textile power processing sector. Scale is denoted by employment �¢���� the average number of persons employed in the industry during the reference period. Technology is denoted by capital intensity - the quantity of capital employed per person. The economic characteristics studied are output per each worker and per each unit of capital employed. Examination of the interrelationships of textile power processing industries in Tirupur.

Firm Location Decisions and Impact on Local Economies

The growth centres programme was announced by the government in 1988 to promote the industrialisation of backward areas. The growth centres provide basic industrial infrastructure like power, water, telecom and banking to enable the states to attract industries. This paper attempts to assess qualitatively the performance of the growth centres on the basis of primary data collected from field visits to several centres, discussion with state governments and visits to several firms located in the growth centres. It is found that without the infrastructure provided by the growth centre, many firms (even some representing local entrepreneurship) would not have located where they are. The firms have a favourable impact on the local labour markets. A few of the firms export and some contribute socially to the local communities. The paper concludes with recommendations for policy at the firm-level and the growth centre-level.

Quality Signals and Export Performance

The relationship between quality, reputation and firm performance is a new research area, where aspects like productivity, efficiency, quality and competitiveness have come to the forefront. Our study, using panel data of 572 Indian firms over the period 1989 to 1997, tries to capture various signals of firm quality and reputation to check whether quality matters in the export market under perceived quality uncertainty. Panel logit model is fitted on the data to confirm whether these quality and reputation signals have a significant influence in determining the probability of a firm to export in the next year. Our econometric results support the existence of a linkage between the product market and financial market, as a firm's financial decisions may drive product market outcomes.

Productivity and Cost in Indian Airlines, 1964-99

The financial performance of state-owned Indian Airlines has been far from satisfactory since 1989-90. The main reason for this has been the high growth in unit cost. So far no attempt has been made to study whether this was the result of decline in productivity or increase in prices of inputs, or both. The present study attempts to relate unit cost with productivity for the period 1964-99. The results reveal that during 1989-99, when many A-320 aircraft were inducted in the fleet, the productivity of Indian Airlines turned negative and unit cost increased at a much higher rate. Productivity decline was the main reason for a rapid rise in unit cost. The paper suggests that Indian Airlines needs to improve its productivity, and weigh more carefully the impact of inductions of new aircraft on its overall performance.

Leather Goods Industry in Kanpur

This study explores how socio-economic factors interlink producers' businesses and production activities, and how business interlinkings cause extra-economic coercion on producers of both the Hindu and Muslim communities, as well as those of various sub-castes and investment sizes. A cooperative could help alleviate many problems of the producers, and also mitigate caste and religious prejudices.

Project Management in the Caribbean

This paper presents a case study of three similar projects in the Caribbean relating to water and sewerage management. After analysing the process of planning and implementation of the projects, the possible causes of time and cost overruns and of the inability to meet the project's goals are investigated. The study also highlights the possible gains from effective post-project evaluation, especially when a common funding agency is involved.

Research and Development in Small Industry in Karnataka

This paper primarily probes the nature and dimensions of R and D activities carried out in small-scale industries in Karnataka. Quite a number of small firms are informally engaged in R and D in the region. External factors like competitive pressure, technological change and customer needs have driven most of these firms to undertake R and D to achieve quality improvement, cost efficiency and competitiveness. Thus 'incremental innovations' are the primary feature of R and D in small firms and they spend hardly 1 per cent of their turnover for R and D.

Quality Silk Production: Some Economic Issues

Indian silk has not only been unable to capture international markets because of its poor quality, but it is also having to compete with better quality imported yarn in the domestic market. While attempts have been made to encourage the production of quality silk, they have not yielded good results. An exploration of the problems of producing quality silk.

Changing Face of Beedi Industry

The beedi industry in the Dakshina Kannada district of Karnataka is rapidly undergoing substantial changes, with some units shifting out of the area. What is the nature of the change? What impact will this have on the local population, a large proportion of whom, especially the poor are employed in the industry?

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