What is it about?
Using firm-level data, this paper investigates whether foreign direct investment and the presence of multinational enterprises explains India’s improved export performance during the postreform period. The recent literature stresses that firm heterogeneity gives some firms, especially MNCs, an edge over others to self-select into export markets. The results show that the impact of foreign ownership on export performance does not significantly differ from that of domestic firms across sectors in Indian manufacturing. Rather, firms build their international competitiveness by importing raw materials and foreign technical know-how, and by investing in research and development.
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Why is it important?
This is very important especially during reforms when there is increasing presence of MNCs in India
Perspectives
The paper shows whether reforms have led to better export performance in India.
Saikat Sinha Roy
Jadavpur University
Read the Original
This page is a summary of: Foreign Direct Investment, Firm Heterogeneity, and Exports: An Analysis of Indian Manufacturing, Asian Development Review, March 2018, The MIT Press,
DOI: 10.1162/adev_a_00104.
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