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

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Growth and Significance of the Private Corporate Sector

This paper seeks to answer three questions: (1) What is the significance of the private corporate sector in the economy? (2) What has been the growth of the private corporate sector relative to that of the public sector and the non-corporate sector? (3) In absolute terms has the private corporate sector in India grown?

Total Factor Productivity Growth and Technical Efficiency in Indian Industries

Based on the panel data for 15 major states in India, this article estimates the time-variant technical efficiency and total factor productivity growth for 17 two-digit industry groups. The total factor productivity growth (TFPG) in a large number of industries seems to have improved across most of the states during 1985-86 to 1992-93 as compared with the rates estimated for the period 1976-77 to 1984-85. Technology acquisition, efficient utilisation of resources and infrastructure development are some of the factors which possibly contributed to the increase in TFPG.

Organisational Arrangement for Learning in Indian Firms

Based on a sample of firms - component suppliers to two major automotive manufacturers - in and around the National Capital Region (NIC) of Delhi, this study shows the variation in the learning ability, intention and effort, depended upon the strategy of the firm. The variation is also dependent on whether the firms want to be market leaders, followers or imitators. Depending upon the firm's strategy, efforts are made to build the firm's absorptive capacity. Tiny firms operate basically at the lower end of technology and hence learning is at the operational level and efforts are not made to retain humanpower. The linkage has, however, resulted in learning on productivity improvement through time, inventory and resource management. The firms that have joint ventures with buyers make special efforts to train and retain humanpower. They also have technological collaborations with world market leaders in their respective fields.

Inter-firm Relationship and Governance Structure

The paper analyses inter-firm relationship in the analytical framework of institutional economics, in particular transaction cost theory. It studies the governance structure of inter-firm relationship as an interaction between various agents, including the role of policy. Based on a case study of Bhilai Steel Plant and its ancillaries, it is argued that the governance structure evolves in the process of interaction, determined by the responses of agents to policy. Further, the realisation of policy objectives depends on the decisionmaking process and responses of agents. The paper emphasises on the shift of policy approach of treating the responses of economic agents as given and 'passive' to that of treating them as active.

European and Japanese Affiliates in India

This paper attempts to identify the variables that distinguish Japanese FDI from European FDI, and to test for their significance in differentiating the conduct and performance of Japanese and European firms in India. There have been studies which demonstrated that multinational enterprises as a group behave differently from non-affiliated local firms. This study highlights intra-MNE differences related to nationality of the MNC, nature of the Indian partner and industry-specific characteristics.

Foreign Direct Investment and Pattern of Trade

This paper explores the relationship between incoming FDI and trade orientation in the Malaysian manufacturing sector. It finds that by pursuing an open and pro-active trade and industrial strategy, Malaysia has been able to realise the benefits of FDI. However, resource-rich transnational companies have brought about a higher level of market concentration.

Economic Development and Technology Accumulation

This paper argues that lack of technology and skill accumulation in the development process is the basic cause of the recent economic crisis in South Korea. Korea's export-led industrialisation required import of capital goods, parts and technology. In its efforts to catch up with developed western countries, it neglected to develop domestic technology.

Japanese Business Activity in Thailand

This paper examines Japanese business activity in Thailand and its relation to local business performance. It focuses on the business indices of leading Japanese and Thai companies in Thailand. It finds that Thailand is introducing foreign capital into the country efficiently. Foreign capital has not only not hurt local capital but has helped it.

Foreign Direct Investment in Asia

This paper analyses trends in FDI in Asia, with a special focus on FDI flows from Japan. It relates FDI flows to changing industrial structure and to trade flows. An econometric analysis is done to identify key determinants of FDI flows to Asian countries. Japan has been the main source of FDI flows to Asia. Japanese FDI has helped cost reduction and export promotion in the host countries. But, in the process, Japan has created a large trade surplus with these countries.

Overcoming Structural Barriers

In examining state-led industrialisation, we find that state-ownership guaranteed capacity build-up in the steel industry in Korea, India and Brazil. But only Korea achieved rapid industrial change by maintaining investment momentum. A bureaucratic approach to industrial governance and populist policies limited the development of the Brazilian and Indian state-owned steel industries. A comparative study of the these late industrialising countries tells us that both innovative behaviour and institutional capability are necessary to organise capitalist production.

Competing through Capabilities

The global textile trading regime is going to change drastically from the year 2005 with the phase-out of MFA. Its implication for competition will be significant. Countries that have already put competition policies in place and firms that have been improving their capabilities are the ones that are going to benefit the most. This paper discusses the nature of competition that Indian textile firms are going to face domestically and abroad in a few years from now. Some of the characteristics of competitive firms that will emerge in the ensuing period are indicated. The paper presents a summary of comparison of Indian primary textile firms with those of China and Canada (based on a primary plant level survey in the three countries). In addition, some processes that are helping the Chinese textile industry grow rapidly are discussed. It is argued that competitiveness of Indian firms would be contingent on developing long-term distinctive capabilities. Three key strategies, namely, Commitment, Co-ordination and Co-operation, for developing distinctive capabilities are presented and illustrations of initiatives at the firm level, industry level and the government level that would form part of the implementation package for each strategy are provided.

Industrial R and D

This paper attempts to demonstrate that while the developing countries are trying to pare down the role of their governments in economic matters, the developed countries are putting in place a number of support measures to help their private sectors to commit more resources to R and D. The efforts of the US and the OECD governments are examined to show how they are articulating proactive public innovation policies.

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