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Working Papers | 1998

Derivatives Committee Report - Four Queries

Gupta Ramesh

L.C.Gupta's Committee on Derivatives has recently submitted its final report to SEBI. It major recommendation is to introduce index futures in order to provide the facility for hedging against market risk in the most cost-efficient way. There are four pertinent questions that need to be publicly debated and the SEBI Board must seek satisfactory answers to these questions before accepting the recommendations: The four questions are: 1) Do index futures provide portfolio hedging? Or do they merely facilitate rebalancing/restructuring of portfolio mix at a cheaper and faster way? 2) How the introduction of index futures would affect the functioning of underlying cash markets in terms of volatility, liquidity etc.? 3) Is there sufficient demand and supply for trading in market risk to facilitate a competitive futures market? 4)Whether Indian capital markets are ready for index hedging? This paper is an attempt to examine critically the above four questions and outlines the investors immediate concerns which SEBI should attend to. The paper concludes that launch delay to insure that appropriate regulatory and institutional measures are in place are well worth the extra time. The haste may result into a major scandal that may undermine both the confidence in and acceptance of equity derivatives as well as the reputation of the entities involved in introducing these products.

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Working Papers | 1998

Simulation: A Decision Making Tool for Construction Manager

Akalkotkar P V, Girja Sharan, and Trivedi Manish

Simulation study of concreting operation for canal lining was carried out, to take a decision on the most appropriate number of Transit Mixers for the efficient working of batching plant.

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Working Papers | 1998

Competitive Advantage of India Exports: Analytic Case Studies of Four Industries

Patibandla Murali, Bahree Jyotika, and Agarwal Avinash

This paper examines the sources and sustainability of competitive advantage of India's exports on the basis of case studies of four labour intensive industries. By applying the conceptual framework of Ghemawat (1991), we show that the factors that provide competitive advantage in the present are not sticky, scarce and appropriable: which means the advantages are not sustainable in the long run. We bring out possible strategies and the underlying factors involved on the international marketing side for sustaining competitive advantage and increasing value-realization of exports.

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Working Papers | 1998

Rational Choice Correspondence in Social Choice Problems

Lahiri Somdeb

This paper grew out of a reading of an interesting exposition by Danilov and Sotskov [1997], where general one to one correspondences are established between binary relations and choice correspondences. Out purpose in this paper is to establish similar and more specific bisections in choice situations that arise in social choice theory. The kind of domain we consider here, has not been considered by Danilov and Sotskov [1997]. We consider social choice problems of the type discussed in the literature on axiomatic bargaining. Instead of choice functions, we consider choice correspondences i.e. multivalued solutions. Expositions of the main results in axiomatic bargaining can be found in Thomson [1994] and an economic interpretation of the problems can be found in Lahiri [1996]. Earlier forays into rational choice theory on such domains are those of Peters and Wakker [1991], and Lahiri [1998].

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Working Papers | 1998

Technical Change and Market Price Effects on Income Distribution in Indian Rice Economy

Namboodiri N V

1432 Considering the Marshallian concepts of producers' and consumers' surplus this study examines the total economic gain from technical change in rice production in India and its distribution among producer-cum consumers (PCC) and non-producer consumers (NPC) at two points of time viz., triennium ending 1982-83 and 1994-95. These are examined separately for those states where rice is multi-season crop and those states where it is mono-season. The total economic gain has increased by four-fold between 1982-83 and 1994-95. The NPC are the major beneficiary in both the periods and more so in states where rice is a mono-season crop. However the relative share of PCC in total economic gain has improved significantly in early 1990s. further the relative shares of both PCC and NPC have improved for the rate of marketed surplus below 25 per cent in both mono-and multi-season states. The sensitivity of rate of marketed surplus and supply function shift showed that the NPC are the major beneficiary from future rightward shift in supply curve assuming constant demand and supply elasticities. The study suggests that while non-product price policies encouraging technical change and market infrastructure development would be beneficial to both PCC and NPC, the rice price support would be needed once technical change occurs to protect the relative share of the former, i.e., producer-cum consumer.

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Working Papers | 1998

Analysis of Agriculture Industry Linkages in Indian Economic Development

Kumar Arvind and Vijay Paul Sharma

The purpose of this study is to examine the trends in India's growth rates and interdependency between agricultural and industrial sectors of Indian economy. A dual economic growth model was developed to investigate the relationship between the two sectors and factors affecting Indian economic growth. The study reveals that the GDP growth rate has increased considerably over the period 1950-95 and the increase is more pronounced in the post-economic reforms period. The industrial sector of the economy in the post-economic reforms period. The Indian economy has made a transition from the predominantly agrarian economy to a more balanced economy with the share of agriculture being about 29 per cent and that of industrial sector about 30 per cent during 1992-95. But the share of agricultural sector is still higher than for most of the developing nations. The results of economic growth model indicate that land is an important input to the growth of agriculture in India. The traditional input, such as labour, does not play an important role in the economic development of both the sectors. Capital investment contributed significantly to the growth of industrial sector, but not to the agricultural sector. It was found that the agricultural growth in India is contributed by its industrial sector and the growth of industrial sector depends on its agricultural growth, indicating strong linkages between the agricultural and industrial sectors in Indian economic development.

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Working Papers | 1998

A Perspective on Land Use Planning for Eastern India

Chakraborti Milindo and Samar K. Datta

Of all the natural resources endowed upon mankind, soil cover on the mother earth has been one of the most important basic resources which plays a strategic role in determining the living standards of human beings. Given the multitude of possible uses of land and the fact that often there are possibilities of emergence of a new use outcompeting the existing users, and consequent conflicts, land use planning is to be considered an important exercise. The present paper is an attempt to provide a perspective on the multitude of uses land is put to in the Eastern states of India and tries to argue that plans should involve minimum reliance on centralised decision making bodies and their budgetary provisions on the one hand and nothing should be left to be decided by the unconstrained functioning of the existing market forces, on the other, Self-governing and self-sustaining decentralised user group institutions at local levels with appropriate higher tier organizations should perform the land use planning exercise and look into their implementation as part of their regular business.

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Working Papers | 1998

A Management Perspective for Sustainable Fisheries Under Globalised Market Conditions: The Indian Scenario

Chakraborti Milindo and Samar K. Datta

India enjoys a vast and versatile resource base in respect of her fisheries. However, the country presently has reached a crossroad so far as sustainable tapping of his resource base is concerned. Defining sustainability not only in terms of economic viability but also in the context of ecological and social compatibility, the study looks into the problems and prospects of sustainable management of Indian fisheries. It analyse the various types of negative externalities arising out of a lack of clearly defined 'property rights' regime, both from within and from without. In doing so it examines the sustainability issues in respect of capture and culture fisheries exports and global competitiveness of fish and fishery products and fishermen's cooperatives. A future policy perspective is developed through comparing the Common Fisheries Policy of the EU and the existing National Fisheries Policy in respect of their capabilities in striking the necessary balance between economic needs and socio-ecological requirements. The study concludes by highlighting the need for evolving a network of brotherhood type organizations institutionalized at local stakeholders' level.

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Working Papers | 1998

Market Reforms and the Criticality of Institutions: A Few Issues in the Indian Context

Patibandla Murali

This paper brings out a few issues on how prevailing institutional conditions are inadequate for an efficient functioning of markets, and on the role of government policy in the transition period in the Indian context. We approach the issue of market institutions form the new institutional economics perspective. The basic argument of the paper is that the prevailing institutional conditions are not totally consistent and are inadequate with the spirit of free market economy and the approach of the reforms has been lopsided. To put it in the words of Williamson (1994), the approach of the reforms should be not just getting the prices right but getting the institutions right: to get the prices right one has to get the institutions right.

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Working Papers | 1998

Operating Characteristics of Empty Solar Cooker

Girja Sharan

In this report we present some of the operating characteristics of an empty box solar cooker, under climatic conditions of Ahmedabad.

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