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dc.contributor.authorFelipe, Jesusen_US
dc.contributor.authorKumar, Utsaven_US
dc.contributor.authorAbdon, Arnelynen_US
dc.date.accessioned2010-12-21en_US
dc.date.accessioned2012-04-12T14:21:33Z-
dc.date.available2012-04-12T14:21:33Z-
dc.date.issued2010en_US
dc.identifier.urihttp://hdl.handle.net/10419/57034-
dc.description.abstractAn extensive literature argues that India's manufacturing sector has underperformed, and that the country has failed to industrialize; in particular, it has failed to take advantage of its laborabundant comparative advantage. India's manufacturing sector is smaller as a share of GDP than that of East Asian countries, even after controlling for GDP per capita. Hence, its contribution to overall GDP growth is modest. Without greater participation of the secondary sector, the argument goes, the country will not be able to develop and become a modern economy. Standard arguments blame the license-permit raj, the small-scale industrial policy, and the supposedly stringent laws. All these were part of the industrial policy regime instituted after independence, which favored the heavy-machinery subsector. We show that this policy bias negatively affected the development of India's labor-intensive sector, as the country should export with comparative advantage a larger number of these products, given its income per capita. However, India's manufacturing sector is relatively well diversified and sophisticated, given also the country's income per capita. In particular, India's inroads into machinery, metals, chemicals, and other capital- and skilled labor-intensive products has allowed the country to accumulate a large number of capabilities. This positions India well to expand its exports of other sophisticated products.en_US
dc.language.isoengen_US
dc.publisherLevy Economics Inst. Annandale-on-Hudson, NYen_US
dc.relation.ispartofseriesWorking paper, Levy Economics Institute 638en_US
dc.subject.jelO20en_US
dc.subject.jelO25en_US
dc.subject.jelO53en_US
dc.subject.ddc330en_US
dc.subject.keywordcapabilitiesen_US
dc.subject.keyworddiversificationen_US
dc.subject.keywordIndiaen_US
dc.subject.keywordindustrial policyen_US
dc.subject.keywordrevealed comparative advantageen_US
dc.subject.keywordsophisticationen_US
dc.titleExports, capabilities, and industrial policy in Indiaen_US
dc.typeWorking Paperen_US
dc.identifier.ppn642324301en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:Working Papers, Levy Economics Institute of Bard College

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