Copyright (c) 2009 All rights reserved. http://works.bepress.com/abhijit Recent documents in Abhijit Sen Gupta en-us Sun, 04 Oct 2009 17:52:54 PDT 3600 http://works.bepress.com/abhijit/20 http://works.bepress.com/abhijit/20 Fri, 02 Oct 2009 23:28:03 PDT Most of the existing literature has used single reserve adequacy measures to evaluate the volume of excess reserves. In this paper, we employ empirical methods to identify an international norm of reserve adequacy, incorporating the various objectives of holding reserves. We then compare the actual reserve accumulation experience of various emerging markets with this international norm predicted by our empirical model. We find that India has been holding reserves in excess of the international norm, and we calculate the cost of holding these excess reserves by looking at three different alternative uses of resources. We find that India is foregoing as much as 1.6% of its GDP by holding excess reserves in low yielding foreign bonds instead of employing resources in alternative uses. Abhijit Sen Gupta International Finance http://works.bepress.com/abhijit/19 http://works.bepress.com/abhijit/19 Fri, 02 Oct 2009 23:20:51 PDT Recent research on model uncertainty has focused mainly on closed economies. Levin and Williams confirm the existence of robust rules across competing closed economy models. In this paper, we evaluate three small open economy models exhibiting different degrees of inflation and output gap persistence. We find that the above result does not carry over to the open economy, primarily due to the mutually exclusive degree of interest rate smoothing that yields stability in the three models. We also confirm the existence of robust rules across the closed economy versions of these models. Finally, a first difference rule, though yields dynamic stability across the open economy models, continues to perform poorly in at least one of the models. Thus, the cost of choosing the wrong model is extremely high in open economies compared to closed economies, and policymakers must invest more resources to know the true structure of these economies. Abhijit Sen Gupta Monetary Economics http://works.bepress.com/abhijit/18 http://works.bepress.com/abhijit/18 Thu, 15 Jan 2009 00:51:53 PST Abhijit Sen Gupta Monetary Economics International Finance http://works.bepress.com/abhijit/17 http://works.bepress.com/abhijit/17 Sat, 31 May 2008 02:58:34 PDT Abhijit Sen Gupta Economics http://works.bepress.com/abhijit/16 http://works.bepress.com/abhijit/16 Sat, 31 May 2008 01:11:17 PDT Abhijit Sen Gupta Industrial Economics http://works.bepress.com/abhijit/15 http://works.bepress.com/abhijit/15 Wed, 09 Apr 2008 05:29:47 PDT Abhijit Sen Gupta International Finance http://works.bepress.com/abhijit/14 http://works.bepress.com/abhijit/14 Sat, 22 Mar 2008 07:39:58 PDT In this paper we evaluate the feasibility of a common Asian Currency Unit (ACU) involving countries of East and South Asia. We analyze the various properties of an ACU and calculate it's value using weighted averages of the values of Asian currencies. Looking at the movement of individual Asian currencies vis-Ža-vis the ACU, we find that there have been severe misalignments among the Asian currencies during the past seven years. We discuss the possibility of the Rupee figuring in the ACU and identify the major economic, political and historical impediments in the way of faster acceptance of ACU in the region. We point out the various strategies that could be employed to facilitate faster adoption of ACU. These include creating certain institutional safeguards as well as strengthening the existing ones. Finally, we highlight some ways to promote the use and acceptability of the ACU and also emphasize the importance of conceiving a larger framework of participating countries, including India. Abhijit Sen Gupta Monetary Economics International Finance http://works.bepress.com/abhijit/13 http://works.bepress.com/abhijit/13 Sat, 22 Mar 2008 07:37:12 PDT Most of the existing literature has used single reserve adequacy measures to evaluate the volume of excess reserves. In this paper, we employ empirical methods to generate a comprehensive reserve adequacy measure, incorporating the various objectives of holding reserves, and compare the actual reserve accumulation experience of various emerging markets with the prediction of our empirical model. Using this comprehensive reserve adequacy measure, we calculate the cost of holding excess reserves for India by looking at three different alternative uses of resources. We find that India is foregoing as much as 2% of its GDP by accumulating reserves instead of employing resources in alternative uses. Abhijit Sen Gupta International Finance http://works.bepress.com/abhijit/12 http://works.bepress.com/abhijit/12 Sun, 24 Feb 2008 23:25:08 PST The Indian manufacturing sector has grown at an impressive average rate of 9.5 per cent annually since 2003-04. Its sustained growth is crucial for generating employment opportunities needed to absorb the rapidly expanding workforce. In this context, this paper reviews the current state of the sector and focuses on determinants of its competitiveness. The paper finds that Indian manufacturing sector exhibits a great deal of regional variation and a marked dualism between the organized and the unorganized segments in terms of both productivity and wage levels. The level of labour absorption in the organized manufacturing sector has been weak as reflected in the declining labour intensity in this sector. This does not augur well for achieving inclusive growth. We also find that although there have been significant changes in the composition of exports in the last 20 years; India is still a very small player at the global level, especially in knowledge intensive and advanced technology products. Finally, the paper explores India's potential for transforming itself into a hub of mass manufacturing. We find that the main constraints in doing so have been the low level of R&D, relative lack of skilled personnel and relatively low FDI levels. Abhijit Sen Gupta Industrial Economics http://works.bepress.com/abhijit/11 http://works.bepress.com/abhijit/11 Fri, 09 Nov 2007 10:05:24 PST Abhijit Sen Gupta International Finance