Suchergebnisse

Now that import-substitution policies have failed and been discredited, there has been a shift in favor of interventions on behalf of export interests. The author argues that close scrutiny reveals these arguments to be as flawed as the old arguments for import substitution. Among other things, the author concludes that: 1) Under perfect competition, a country trying to retaliate against a trading partners export subsidies by instituting its own export subsidies, will only hurt itself. 2) The argument that export subsidies may be useful for neutralizing import tariffs, is spurious. In most practical situations, this is not possible. Removal of tariffs is a far superior policy. 3) In principle, a case can be made for protecting infant export industries in the presence of externalities. But the empirical relevance of externalities remains as illusory for export industries as it was for import-substituting industries. 4) Adverse selection and moral hazard can lead to the thinning of the market for credit insurance, but that is not a case for government intervention. 5) India's experience shows export subsidies to have little impact on exports. Brazil and Mexico's experience shows export subsidies to be a costly instrument of export diversification. 6) Those who argue that pro-export interventions were important in East Asia have not provided convincing evidence of a casual relationship between the interventions and growth.

This paper presents some general‐equilibrium models of the parallel market in centrally planned economies. The models are based on the hypotheses that private firms can operate more efficiently than bureaucratically‐run state enterprises and that Soviet‐type economies are characterized by price controls and quantitative allocations. The state's enforcement policy is explicitly modeled. Although the welfare implications of the parallel market for workers are ambiguous in general, under a variety of circumstances they turn out to be negative. For instance, responding to the shortage created by price controls, illegal firms divert resources from the official economy into the parallel market. The result is a higher price in the parallel market without any increase in the total supply of the good.

Exploiting large data sets, the essays in this first volume in the series Studies in Indian Economic Policies show that trade openness has helped reduce poverty among most social groups including the Scheduled Castes. Openness has affected neither poverty nor inequality adversely. When surveyed, people in disproportionately large volumes from all groups say that their fortunes are improving. This is also reflected in election outcomes with the governments delivering good economic outcomes winning and the others losing.

While considerable progress has been made in analyzing the formulation of international economic policies, the existing literature remains deficient in several respects. First, the existing models take a relatively simplistic view of the political-economy environment. For example, in contrast to the observed reality, a large majority of the models view the government as a monolithic entity. Second, there is only limited recognition of the political-economy interactions between interest groups across national borders. Third, dynamic factors governing trade policy formulation have been essential