ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Articles by Atulan GuhaSubscribe to Atulan Guha

The Proposed Deregulation of India’s Sugar Sector

The deregulation of agricultural markets and its scope for benefits to farmers are examined using the system generalised method of moments to estimate India’s supply equations of sugar and sugarcane. An alternative theoretical framework is used to generate the supply equations—different from Nerlove’s Adaptive Expectations-based supply response function or the assumption of profit-maximising firms operating in a freely competitive market—which fits into the sugar sector’s regulatory system in India. The findings suggest that the proposed deregulations will not reduce the sugar sector’s cyclicality nor will it create a win-win situation for farmers and mills. Instead, the mills will benefit at the cost of farmers.

Link between Food Price Inflation and Rural Wage Dynamics

In exploring the link between food price inflation and rising rural real wages, this paper examines the dynamic relations between rural wages in different sectors and the relationship these wages share with increasing food prices. It looks into the possibility of a Lewisian transformation causing an increase in real rural wages, but the result of the analysis suggests that the rise in wages is because of an increase in bargaining power due to public works programmes, which employ unskilled rural workers. Food price inflation induces them to bargain for higher wages.

Undermining Panchayati Raj Institutions in Gujarat

This article argues that the panchayati raj institutions in Gujarat are being undermined by the state government. The failure to evolve financial devolution to fund the PRIs is making them financially dependent on the state government. Further, the Samras Gram Yojana, which encourages consensus candidates without elections plays into the hands of traditional dominant castes' power.

Labour Market Flexibility: An Empirical Inquiry into Neoliberal Propositions

There have been proposals to make the Indian labour market more flexible by amending the Industrial Disputes Act, 1947 and Contract Labour Act, 1970. But the Indian labour market has already achieved a substantial degree of flexibility by the contractualisation of factory workers. This paper critically investigates the claims made in favour of introducing greater flexibility in the labour market. The analysis is done through an empirical inquiry into the proposition that casualisation of labour leads to higher output and employment growth. We find that employment and output growth do not have a statistically significant dependence on labour market flexibility in Indian organised manufacturing.

Exchange Rate Management in Gold Standard Era: A Historical Overview

Under the gold standard era, exchange rates were managed not through adjustment in the current account but through changes in the capital account and stock of monetary gold and reserves. Though the exchange rate of a currency was theoretically directly linked to the central bank's stock of monetary gold reserves, the countries that had a greater rate of interest elasticity of capital flows could keep a low stock of these reserves. For these countries, interest rate policy was used to stabilise exchange rates. The rate of interest elasticity of capital flows was dependent upon its currency's use as international money. And the degree of use of a currency as international money was dependent upon the issuing country's economic and political hegemony.

Company Size and Effective Corporate Tax Rate

This article examines the relationship between company size and the effective corporate tax rate for Indian private manufacturing companies in a multivariate framework, using panel data for 1992-2001. The model includes the scheduled tax rate as a proxy for time-specific effects along with the explanatory variables - financial leverage, ratio of net property, plant and equipment to total assets and exportability of the companies. Despite separating out the impact of these company characteristics, the size of the companies influences their effective tax rate. The larger the company, the lower is the effective tax rate. The article does not find very clear-cut reasons behind this negative relationship due to lack of transparency on the part of the tax department in revealing information regarding tax returns of the companies. But there may be an unknown factor, built into the political-administrative system of our country, through which larger companies are able to reduce their effective tax rate.

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