Showing papers by "Indira Gandhi Institute of Development Research published in 2015"

Urbanization and Spatial Patterns of Internal Migration in India

Abstract: With an urbanization level of 31.16 % in 2011, India is the least urbanized country among the top 10 economies of the world. In addition, unlike other countries, the transition of workforce out of agriculture is incomplete. This coupled with jobless growth in recent years has contributed to an increase in certain migration streams. While rural–rural migration continues to be the largest in terms of magnitude, we also document an increase in two-way commuting across rural and urban areas. Further, there are a large number of short term migrants and an increase in return migration rate is also observed.

Corporate Social Responsibility in India—An Effort to Bridge the Welfare Gap:

Abstract: Drawing on existing theoretical and empirical literature on the rationale behind corporate social responsibility (CSR), this article analyses the potential implications of mandated CSR under the re...

Access to modern energy services: An economic and policy framework

Abstract: Affordable and accessible modern energy services are a pre-requisite for development—economic, environmental or social—and are crucial to reduce poverty and sustain growth. Hence, there is a need to promote the uptake of modern energy. The present study investigates the issue of accessibility of modern energy services in relation to three indicators—availability, affordability and reliability—and suggest practical ways of evaluating them, and identifies various strategies to provide them to the needy households in a cost-effective manner. Promoting the development of small rural enterprises is a key contributor to achieve this goal and a central aspect in this promotion is the large-scale diffusion of Sustainable Energy Technologies, which provide affordable and reliable services. The suggested framework helps the policymakers to identify technologies that are better than others under the present conditions. Implementing and scaling up the energy demand requires collaboration among various actors like households, local bodies, energy utilities, governments, entrepreneurs, research organisations, non-governmental organisations, community groups, financial institutions, and international agencies.

Internet of Things and libraries

Abstract: Internet has taken a giant leap forward from ‘Internet of communication’ to ‘Internet of Things’, making it possible to connect objects and transfer data with or without human intervention. This is likely to revolutionize the way we live. Like other service industries, it has a huge potential in betterment of library services. An attempt has been made to explain what is ‘Internet of Things’, the technology and its growth, examples from service industries and deliberate on it’s possible impact on libraries and identify potential library areas where it can be implemented effectively.

Food Security in India: The Imperative and Its Challenges

Abstract: This article addresses the imperative of food security in India in the context of persistent prevalence of malnutrition despite several years of rapid growth. In particular, the article posits that the recent promulgation of the National Food Security Act in September 2014 to meet this challenge also offers an opportunity to reconfigure its food distribution system and agricultural trade policy. These two issues pose the greatest and most immediate challenges for India. The more enduring challenge for India would be to sustain food production to ensure not only adequate quantities, but also to support dietary quality and diversity.

MGNREGA Works and Their Impacts A Study of Maharashtra

Abstract: MGNREGA works support agriculture, and benefit a large number of small and marginal farmers. An overwhelming 90% of the respondents considered the works very useful or somewhat useful, while only 8% felt they were useless. Further, most works continue to be maintained and are in a good condition. Overall, this study suggests that the widespread perception that the

Exploring the Venture Capitalist-Entrepreneur Relationship: Evidence from India

Abstract: Maintaining cooperation and avoiding opportunism is essential for a healthy Venture Capitalist (VC)-entrepreneur relationship. Therefore, the purpose of this paper is to explore the role of control and trust for developing a cooperative VC-Entrepreneur relationship in an agency environment in the Indian context. The study adopts a multiple case study approach to investigate 10 VC-Entrepreneur dyads. It uses data collected from both primary and secondary sources. Content analysis was used as the data treatment technique. The empirical evidence indicates that VC-Entrepreneur relationships emerging in the early stages suffer from low agency risks and use more of relational mechanisms to curb opportunism and develop cooperation while relationships at an advanced stage suffer from higher agency risks and employ more of control mechanisms to address it. The findings can be utilized to enhance cooperation in VC-Entrepreneur relationship by identifying the appropriate context to apply relational or control mechanisms, which would eventually lead to better performance of the venture. This distinction results in the development of a theoretical model which shows how the dual governance mechanisms of control and trust interact with one another to affect confidence in partner cooperation as an entrepreneurial venture raises multiple rounds of venture capital across various stages. The data collected from Indian VC-Entrepreneur dyads offers a rich description of the relationship dynamics across the Indian entrepreneurial ecosystem.

Can the Rural Employment Guarantee Scheme Reduce Rural Out-migration: Evidence from West Bengal, India

Abstract: Using survey data from the Cooch Behar district of West Bengal, the paper documents the impact of the rural employment guarantee scheme in reducing rural out-migration. Using regression framework and case studies, it finds no significant impact of household participation in the programme on migration decision. However, extent of participation in terms of number of days of work and earnings has a significant negative impact on short-term migration but not on longer duration ones. The findings lay emphasis on effective implementation in terms of asset creation, reduction in rationing of works and tackling delayed payments to enjoy its potential benefits.

Farm Size and Returns to Cultivation in India: Revisiting an Old Debate

Abstract: This paper revisits the long-debated question of the relationship between farm size and productivity by studying the relationship between area cultivated and net returns to cultivation in India using a nationally representative data-set. The analysis is carried out separately for the two major agricultural seasons, kharif and rabi, and for both the seasons pooled together. Our findings suggest the existence of an inverse relationship, even when we control for a number of household and farm characteristics and even when we treat factors such as household type (occupation), social group (caste), agro-climatic zone (region) and agricultural season as fixed effects. The result is also robust to correction for selection bias. However, the efficiency of the smallholder as a result of this greater productivity has to be treated with some caution as it ignores the low absolute levels of their returns, which raise questions about the sustainability of their livelihoods. This is further aggravated by the fact that ...

Short-term Migration and Consumption Expenditure of Households in Rural India

Abstract: In 2007–2008, short-term migrants (STMs) constituted 4.35% of the rural workforce in India and a total of 9.25 million rural households included STMs. Using nationally representative data for rural India, this paper examines differences in consumption expenditure across households with and without a household member who is a STM. We use an instrumental variable approach to control for the presence of a STM in a household. We find that households with a STM have lower monthly per capita consumption expenditure and monthly per capita food expenditure compared to households without a STM. STMs are not unionised, they work in the unorganised sector, they do not have written job contracts, and state governments are yet to ensure that the legislation protecting them is properly enforced. This could be one of the reasons why we do not observe higher levels of expenditure in households with such migrants.

Women on Board and Performance of Family Firms: Evidence from India

Abstract: This paper provides evidence on the effect of women directors on the performance of family firms with a case study of India. Existing literature on the subject has primarily focused on widely held firms, notably in the US. Given that ownership structure and governance environment of family firms are distinctly different from those of non-family firms, the evidence on the relationship between women on board and firm performance in the context of widely held firms may not apply in the context of family firms. India provides an ideal setting for analyzing this question as the presence of family firms is pervasive and since 2013 India has instituted gender quotas on corporate boards. Using a data-set of 10218 firm year observations over a ten year period from 2005 to 2014 which spans the pre-quota and post-quota years, we find robust evidence that women directors on corporate boards positively impact firm value and that this effect increases with the number of women directors on board. However, we find that the positive effect of gender diversity on firm performance weakens with the extent to which the family exerts control through occupying key management positions on the board. In addition, women directors affiliated to the family have no significant effect on firm value, whereas independent women directors do. Our results with respect to profitability are somewhat different; while as in the case of market value, women directors positively impact profitability with the positive effect driven by independent women directors, the effect does not vary with the extent of family control. Taken together, our results suggest that though gender diversity on corporate boards may positively impact firm performance in family firms in general, the extent of family control can have a significant bearing on this relationship. The findings from this study could be instructive for many other emerging economies like India which are considering promoting gender-based quotas on corporate boards.

Methodology of the Social Sciences in the Age of Complexity: Unity, Autonomy or Integration?:

Abstract: The principle of ‘unity of sciences’ (comprising natural, social and human sciences) has a long history. While the term ‘unity’ lends itself to various interpretations, in recent years it is generally understood as ‘methodological unity’. In opposition to the ‘unity’ viewpoint, several social scientists have argued for the methodological autonomy of social sciences. This article attempts to analyze the reasons behind the triumph of the ‘unity’ principle around the 1960s, and how it ushered in an era of formalism in social sciences, especially economics. Dissatisfaction with formalism, in general, and Bourbakism, in particular, in recent years has prompted the search for alternative methodologies in the social sciences, with complexity theory offering much promise.JEL: A12, B41

Bank Risk Behavior and Connectedness in EMU Countries

Abstract: Given the structural differences in banking sector and financial regulation at country level in European Economic and Monetary Union (EMU), this paper tries to estimate the banking sector risk behavior at country level. Based on contingent claim literature, it computes “Distance-to-default (DtD)” at bank level and analyses the aggregate series at country level for a representative set of banks over the period 2004-Q4 to 2013-Q2. The indices provide an intuitive, forward-looking and timely risk measure having strong correlations with national/regional market sentiment indicators. An underlying trend exists but causality tests suggest no systemic component. Cross-sectional differences in DtD suggests fragility in EMU countries 12-18 months prior to the crisis and better predictive ability than the regulatory index based on large and complex banking institutions at European level. Furthermore, we explore the reasons for this divergence using VAR estimates.

Decomposing Poverty Change: Deciphering Change in Total Population and Beyond

Abstract: In the understanding of decomposing poverty change, the growth effect of mean income is replaced with the growth effect of total income and the impact of change in total population. These two, along with changes in inequality, form the three broader effects that can be computed in multiple ways depending upon the base period and the sequence of calculation. Changing the base does not alter the broader effects while specific attributions within each effect get interchanged. For a given base, there will be six possible sequences and we take an average of these to compute the three broad effects. Finally, poverty change on account of the three broad effects comprising growth of total income, change in inequality, and change in total population are shown as part of the within-group effect while change in population shares, which is different from change in total population, is a between-group effect. We provide empirical illustrations with data from India.

Sovereigns and Banks in the Euro Area: A Tale of Two Crises

Abstract: This study attempts to identify and trace inter-linkages between sovereign and banking risk in the euro area. To this end, we use an indicator of banking risk in each country based on the Contingent Claim Analysis literature, and 10-year government yield spreads over Germany as a measure of sovereign risk. We apply a dynamic approach to testing for Granger causality between the two measures of risk in 10 euro area countries, allowing us to check for contagion in the form of a significant and abrupt increase in short-run causal linkages. The empirical results indicate that episodes of contagion vary considerably in both directions over time and within the different EMU countries. Significantly, we find that causal linkages tend to strengthen particularly at the time of major financial crises. The empirical evidence suggests the presence of contagion, mainly from banks to sovereigns.

In Search of Inclusion: Informal Sector Participation in a Voluntary, Defined Contribution Pension System

Abstract: This paper examines who contributes and who persists in contributing in a national, voluntary, defined contributory pension programme, where the government provides the incentive of matching contributions of a minimum amount (USD 16). The paper uses proprietary data from a financial services firm where 12 per cent of customers (37,000 individuals) chose to participate in this programme. The evidence shows that only about 50 per cent of contributors reach the minimum amount for the co-contribution, but that participants persist in contributing even if they failed to contribute the minimum amount in a given year. While this paper does not provide causal estimates, it does present evidence of considerable interest among the informal sector in a state-run voluntary pension programme in an emerging market where access to formal finance is otherwise poor.

Understanding High Inflation Trend in India

Abstract: Stylized Indian facts and structural features are consistent with an elastic aggregate supply, subject to cost push. A variety of time series tests support this against an alternative hypothesis of...

Short term migrants in India: Characteristics, wages and work transition

Abstract: With 53 percent of India's labour force still engaged in agriculture it is apparent that India has not witnessed a reduction in the share of population working in agriculture. This is primarily because in the two decades of economic reforms, beginning the nineties, adequate new jobs were not created in other sectors of the economy. With rural unemployment rates being sticky, the phenomenon of short term migration has become important in rural India. This paper uses a nationally representative data on migration to examine the characteristics of short term migrants. Since the spatial distribution of jobs is an important determinant of the decision of migrate we compute the location quotient to identify whether a district has a higher concentration of workers in agriculture, manufacturing, construction and services sector. After controlling for household and individual characteristics, we find that an ndividual is more likely to be a short term migrant if the individual is from a district with a higher concentration of workers in the construction industry. Using instrumental variable model, we find that short term migrants earn low wages compared to non-short term migrant. Following this we model the transition of short term migrant workers across industries drawing on the literature on transition measures developed to measure income and occupational mobility.

Social protection for poor, vulnerable and disadvantaged groups

Abstract: Purpose – The purpose of this paper is to identify the pathways through which social protection policies in China and India can address the key challenges facing poor, vulnerable, and disadvantaged groups under rapid transformation in both countries. Design/methodology/approach – This paper reviews the main social protection policies in China and India and analyzes the challenges that they are facing. This analysis is based on an evaluation of poverty and food security trends in both countries among vulnerable and disadvantaged groups followed by an overview of major experiences and gaps in social protection policies in the two emerging Asian giants. Findings – Improving the coverage and targeting of social protection systems is vital, and will require a multi-faceted reform portfolio that promotes more integrated and horizontally equitable systems. Emphasis should be placed on developing productive, cross-sectoral social protection programs that combine short-term social safety support with long-term too...

Trade and stock management to achieve national food security in India and China

Abstract: Purpose – China and India have to provide food security to 1.36 billion and 1.25 billion populations, respectively. The purpose of this paper is to address the roles of trade and stock management in achieving food security in these countries, such as the impacts of trade on consumer and producer prices and incomes of farmers and others and implications for food security, and the impact of stock management on price stability, availability, access and nutrition. Design/methodology/approach – The paper is based on secondary data and literature on these issues. It compares the policy tools of trade and stock management used in India and China for food security purpose, in terms of long-term efficiency, in order to provide better understanding on how to achieve food security through public interventions. Findings – Although stock is an important tool for food security, it is likely to be costly if used for price support and redistribution purposes. Trade might provide cheap food to enhance access to food, the ...

Poverty Estimates in India: Old and New Methods, 2004–2005

Abstract: This article provides estimates of poverty and inequality across states as well as for different subgroups of the population for 2004–2005 by using the old and new methods of the Planning Commission. The new method is critically evaluated with the help of some existing literature, and its limitations are discussed with regard to doing away with calorie norm, use of median expenditure as a norm for education when the distribution is positively skewed, difficulty in reproducing results for earlier rounds acting as a constraint on comparisons, and using urban poverty ratio of the old method as a starting point to decide a consumption basket. More importantly, it discusses the implications on financial transfers across states if the share of poor is only taken into account without accounting for an increase in the total number of poor. Despite these limitations, on grounds of parsimony and prudence, the state-specific poverty lines suggested in the new method, as also in the old method, are used to discuss implications on poverty for different subgroups of the population (i.e., NSS regions, social groups, and occupation groups). It also raises concerns on reducing a complex social phenomenon such as poverty to a narrow set of parameters and also its implications on policymaking.

Linkages between poverty, food security and undernutrition: evidence from China and India

Abstract: Purpose – China and India are two of the fastest growing economies in the world, and poverty reduction has been substantial in both countries through the past few decades. Yet they have very different profiles in terms of food security and undernutrition – while at the micro-level China has performed well in terms of undernutrition, India has not. The purpose of this paper is to examine linkages between poverty, food security, and undernutrition in both countries. Design/methodology/approach – In this paper, the authors discuss the linkages between poverty, food security, and undernutrition at the micro level, describe the literature, and make inferences for targeting the remaining poor, food insecure, or undernourished in both countries. Findings – In China, there is a need for better tools for targeting the poor or malnourished. In India, more effective state-level policies should be better understood by the central government and disseminated to less successful states. Originality/value – In this paper...

Reviving Growth in India: Growth Drivers: ICT and Inclusive Innovations

Abstract: INTRODUCTION Innovations are essential to raise productivity and sustain growth. Inclusion is also important to sustain growth, since it prevents possible political unrest, raises average productivity and expands the market size. Innovations using Internet and mobile communication technologies (ICT), especially, suit inclusion, and therefore, sustain inclusive growth, which is a major Indian objective. Inclusion and growth can go together if inclusion is of the type that facilitates growth. ‘Active inclusion,’ defined as creating conditions for the many to contribute to and participate in growth (Goyal, 2012), is of this type. An inclusive innovation is one that creates products that can be accessed by all classes, improving their productivity, and are not restricted to the elite. This chapter develops a simple analytical framework that clarifies the conditions that foster inclusive innovation in Emerging and Developing Economies (EDEs). It brings out two ways of facilitating inclusion through innovation: first, to induce more technical change in products consumed by the less well off, thus, lowering costs for them and second, to make more resources available for them or reduce their transaction costs so that they can afford better products. Alternative ways of doing this are through income transfers or through better systems or public provision of the relevant infrastructure. The latter are suited to active inclusion. The analytical framework shows that large market size stimulates innovation to profit from it, since adoption and further adaptation of technology responds to economic incentives. Increasing the market size creates broader incentives for innovation and reduces the need for direct government inputs that have been difficult to provide. Since market size strengthens private incentives for inclusive innovation, it is likely to improve outcomes. Next, the chapter assesses India's telecommunication policy (2012) and policy changes towards mobile banking to examine the extent to which they have improved relevant infrastructure such as broadband, or taken steps to increase the market size.