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

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Constant Market Share Analysis

This is with reference to my article ‘Sources of India’s Export Growth in Pre- and Post-Reform Periods’ (June 23). I regret the inadvertent omission to acknowledge some previous studies that have applied the method of constant market share (CMS) to analyse the growth of India’s exports, though my paper did not make any claim that the method was used for the first time in the Indian context. The most recent of these studies, to my knowledge, is the book by A Ganesh Kumar, Kunal Sen and Rajendra R Vaidya (2003), International Competitiveness, Investment and Finance: A Case Study of India, Routledge, London (I encountered the CMS analysis in their book after my paper was published).

Kumar, Sen and Vaidya (2003) used the CMS methodology to decompose the annual change in India’s total merchandise exports over the period 1970-96. Analysis in my paper covers a longer time period (1962-2005) with the focus on the post-reform period (1993-2005) and includes services exports in addition to merchandise. For the time period covered in both the studies (1970-1996), the CMS analysis provides broadly similar results. Other studies that applied the CMS methodology in the Indian context [e g, S Marjit and A Raychaudhuri (1997), India’s Exports: An Analytical Study, Oxford University Press, New Delhi] analysed exports to the OECD countries and covered the period prior to 1990 [see Kumar, Sen and Vaidya (2003) for references to the earlier studies].

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