Indira Gandhi Institute of Development Research

About: Indira Gandhi Institute of Development Research is a facility organization based out in Mumbai, Maharashtra, India. It is known for research contribution in the topics: Monetary policy & Inflation. The organization has 307 authors who have published 1021 publications receiving 18848 citations.

Will a matchmaker invite her potential rival in

Abstract: This paper analyzes optimal strategies of an incumbent intermediary, who matches agents on the two sides of a market, in the presence of entry threat under alternative scenarios. It shows that, when entry is free, strategic entry accommodation is the optimal choice of the incumbent—not entry deterrence, unless the variation in agents' types is small. Entry accommodation remains optimal for the incumbent for a wide range of parametric configurations even when there is a fixed cost of entry. These results are in sharp contrast to the predictions of existing models of entry.

The Degree of an Exact Order Matrix

Abstract: The classes of exact order k matrices for any positive integer k, were defined and studied by Mohan, Parthasarathy and Sridhar Mohan, S. R., T. Parthasarathy, R. Sridhar. 1994. The linear complementarity problem with exact order matrices. Math. Oper. Res.19 618--644.. Here, we prove results on the linear complementarity problem LCPq, M, for M belonging to the class of exact order k, k ≥ 3, using the concepts of degree theory. Our main result in this paper consists in proving that a matrix M ∈ Rn×n of exact order k, for any positive integer n ≥ k + 3, belongs to the class Q if and only if the degree of M is either +1 or -1. Also, a complete characterization of exact order 2 matrices is presented, in terms of their inverse structure.

Assessing Changes in the Global Financial Architecture from an Emerging Market Perspective

Abstract: The article assesses changes in the global financial architecture and related global governance. Despite useful reforms lacunae remain. Analysis of financial regulations and measures to address global imbalances show serious weaknesses in addressing risks from shadow banking and large banks that are responsible for volatile capital flows to emerging markets (EMs). The underlying philosophy that intervention and controls distort markets and manipulate currencies weakens the toolbox available to EMs to deal with volatile capital flows. The use of quantitative easing and deficits are regarded as a valid response to domestic conditions in advanced economies, and their effect on commodity price inflation hitting EMs not acknowledged. Despite greater representation of EMs in the G-20 adjustment continues to be asymmetric. This harms global stability and recovery. Universal adoption of some basic minimal measures can close arbitrage gaps and resolve many problems.

Credit Rationing in Rural Credit Markets of India

Abstract: This paper analyses the prevalent situation of the formal financial institutions in rural India using data from National Sample Survey 54th Round (January-June, 1998). We use sample selectivity model to examine the sanction of the loan by the financial institutions as a two-stage process. We model the choice of the household's credit requirement using an unordered choice model, namely, a multinomial logit model. Our results reveal that the rural households are considerably credit constrained. The households who do not have an account in a financial institution have a lower chance of obtaining the loan and households who are credit constrained have relatively lower land holding and they do not possess livestock. Households who borrow for non-farm purpose exhibit a lower chance of obtaining credit compared to those households who borrow for farm business. Village level infrastructure plays an important role in determining the credit rationing behaviour in rural-India.

Dynamics of Wholesale Bid-Ask Spreads in Vertical Markets

Abstract: This paper investigates the short run efficiency of wholesale markets within the context of vertical markets. We propose a partial adjustment model to examine the dynamics of the wholesale bid-ask spread and determine whether this has any impact on hoarding at the wholesale level. The dynamics of Bid-Ask spread is then endogenised in a general model of price transmission at the retail level to determine the impact of such dynamics on a) price transmission and b) the extent of hoarding. Finally we test this generalized model against the extant models of price transmission and show that the generalization is more appropriate.