Globalization and Trade

In the last ten years, several books and a large number of research papers were published under the theme, Globalisation and Trade. The research papers were published in journals such as The Journal of Development Studies, Research Policy, Journal of Development Economics, Applied Economics, Journal of International and Area Studies, Journal of Developing Areas, The Information Society, The Journal of International Trade and Economic Development, and Economic and Political Weekly.

Over time, the focus of the research has become wider. At one stage, the bulk of the research was on issues relating to technology transfer and multinational enterprises. The coverage was subsequently broadened to include trade and emerging issues of World Trade Organization (WTO). It was also felt that the research on globalization should cover economic and social conflicts on account of globalisation both within the economy and externally, and cross-country experiences on globalisation.

The studies carried out in the last ten years can be grouped under the following heads:

Global Business, Multinational Enterprises and Technology Transfer. The following issues were studied: the kind of foreign direct investments (FDI) that countries like India are likely to attract in the WTO regime; role of FDI in research and development (R&D); determinants of technology imports and relationship between technology imports and in-house R&D activities; choice between international joint ventures, licensing and buy-out decisions; different modes of technology transfer by multinational enterprises (MNEs) – intra-firm transfer through FDI, arms length licensing of disembodied technology, and transfer of embodied technology through export of capital goods; differential behaviour of the Japanese, the US and the European multinationals; location advantages and FDI; presence and performance of MNEs in East Asian countries.

Globalisation and Small and Medium Scale Industries. The issues covered are: impact of liberalisation on small scale industries; technological change in small scale enterprises; e-business and small and medium enterprises (SMEs); role of information and communications technology (ICT) in the export performance of garment manufacturing firms; determinants of the use of ICT and its impact on technology up-gradation and product exports of electronic goods manufacturing SMEs.

Liberalisation, Deregulation and Investment. Studies under this group concentrated on analyzing the impact of the Indian liberalisation measures on the investment behaviour of MNEs and domestic firms, and the impact of liberalisation on the competitiveness of enterprises.

Technology, productivity and Globalisation. The issues covered are: liberalisation, technology and efficiency of firms; information technology (IT), productivity and growth; globalisation, productivity, efficiency and growth.

Comparative Asian Studies – ASIAN, China and India. The studies covered the following aspects: IT software and hardware, China-India comparison; regional distribution of FDI, China–India comparison; investments in East Asia; Chinese accession to WTO, impact on China and India.

Studies on exports and trade. These studies analyse: export performance of the Indian garment manufacturing firms; impact of MNEs and technology imports on export performance; incidence of tariffs in India.

Other Studies. These include studies on: mergers and acquisitions; location of plants of foreign companies; relationship between trade and foreign investment.

Medium Term Research Agenda (2006-2011)
Research would continue on most the themes mentioned above. While continuing with the earlier themes, it is proposed to work on issues relating to:

• Liberalisation and Employment

It is often argued that developing countries import technology from the developed countries which do not suit their requirements, particularly in relation to the objective of labour absorption on a large scale. The process of globalisation is expected to have eased the flow of technology and knowledge across countries. Hence, the fear is that employment growth may not rise in the developing countries with the large scale import of technology from abroad. However, the alternative view is that there can be complementary relationships between domestic and foreign technology and hence, the positive benefits of globalisation are noteworthy. It is proposed to examine this issue in detail.

• FDI Determinants and its impact: South Asian Perspective

Though south Asian countries have been persistently opening up their economies and giving investment incentives, South Asia, both collectively and individually, has been receiving very low FDI compared to other developing countries. Thus research on this front will critically analyze the FDI policies and issues and empirically analyse the determinants of FDI in South Asian countries. Given the lack of infrastructural facilities in south Asian countries and the importance of infrastructure in attracting FDI, the study would examine the impact of infrastructure along with other relevant variables on FDI inflow in South Asia. Further, impact of investment incentives and investment treaties on foreign direct investment in south Asian countries would be analysed. The impact of FDI on host country economy is debatable and far from clear for south Asian countries. Therefore, a few studies would be taken up in future to analyse quantitatively the FDI impact on growth, investment, exports and employment. Since south Asian countries have been following export-led growth strategy and trying to attract FDI to boost competitiveness in export sector and increase export, the study would examine the impact of FDI on Exports in south Asian countries. There is also a scope to carry out research on issues such as labour reforms as a major determinant of FDI in South Asian countries and also on employment related FDI strategy in countries like India where unemployment problem has been persistent for several decades.

• India-ASEAN Free Trade Area

It is proposed to study the impact of India-ASEAN FTA on trade flows and domestic industries in India. The impact of the India-ASEAN and China-ASEAN FTA on FDI flows especially FDI flows from Japan and ASEAN countries is another aspect that would be studied.

• Restructuring of Product Lines in Response to Import Liberalisation
How Indian manufacturing companies have been restructuring their products in response to import liberalization is proposed to be investigated. The related issues that will be analyzed include intra-industry and inter-firm trade that may accompany such restructuring of product lines.

Faculty Profile Link Email
Mitra, Arup Link arup@iegindia.in , arup@iegindia.org
Sahoo, Pravakar Link pravakar@iegindia.in , pravakar@iegindia.org


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