Importing Risk into Insurance C.P. Chandrasekhar

On October 4, in a cabinet decision that had been predicted by the media and expected by the stock market, the UPA II government announced hikes in the ceiling on foreign equity ownership from 26 to 49 per cent in units in the insurance sector and from nil to 49 per cent in the pension fund industry. This hike in the FDI ceiling, which was contrary to the recommendations of the Parliamentary Standing Committee, was part of a package of “insurance reforms”, that included: (i) granting permission to the public sector general insurance companies and the GIC to raise capital…

Labour Market Regulations and Economic Outcomes: Some capital lessons and minor messages Praveen Jha, Sakti Golder and Swayamsiddha Panda

This paper provides a survey of the empirical evidence on the relationship between labour market institutions and economic outcomes. Survey of major cross-country empirical constructs that examine linkages between labour regulations and different aspects of economic performance such as employment, growth, etc., shows that the empirical basis for the advocacy of blanket labour market flexibility is rather weak. The paper also highlights some key empirical findings from the organised manufacturing sector in India and postulates some capital lessons and minor messages that emerge from such an exercise. Labour_Market (Download the full text in PDF format)

Can Africa and China Learn from Each Other? Lim Mah-Hui

The following is a speech made by Dr. Lim Mah-Hui on behalf of the South Centre at a Seminar on the 18th meeting of Afreximbank Advisory Group on Trade and Export Development in Africa, High-level Roundtable 1– Can Africa learn from China?, in Beijing on July 13. The seminar was held in conjunction with the 19th General Meeting of Shareholders of African Export-Import Bank. The South Centre is thus very pleased to be invited here to take part in a meeting on this important topic -- the relationship and cooperation between Africa and China. China is a huge country that…

The Continuing Need for Industrial Policy Jayati Ghosh

A panel discussion in Doha, Qatar, as part of the Thirteenth UN Conference on Trade and Development (UNCTAD XIII) brought together some economists and policy makers to provide new perspectives on industrial policies in the South. It became evident that industrial policies have been significant, if unsung, forces behind the much trumpeted “emergence” of some developing economies as major players in the world stage. For some time now, in different parts of the world, industrial policy has been making a comeback. Indeed, as participants in the panel noted, it never really went away, especially in the more successful countries, even…

Employment shifts after the Global Crisis C.P. Chandrasekhar and Jayati Ghosh

For more than a year now, it has been evident that the ''recovery'' from the Great Recession, which has been visible if sputtering in terms of output growth in the core capitalist countries, has not delivered anything like the increases in employment that were expected. A recent report of the ILO (''Short-term employment and labour market outlook and key challenges in G20 countries'', ILO and OECD September 2011, page 1) points out: ''With economic activity slowing in several major economies and regions, earlier improvements in the labour market are now fading, hiring intentions are softening and there are greater risks…

Should ‘‘Open innovation’’ Change Innovation Policy Thinking in Catching-up Economies? Considerations for policy analyses Erkki Karo and Rainer Kattel

This paper provides a review of the current state of academic and policy-level debates on ‘‘open innovation’’ by elaborating on the relevance of the concept of open innovation for innovation policy-making in catching-up economies. The paper shows that paradoxes and contradictions exist between the ‘‘mainstream’’ innovation discourse and the development challenges of the catching-up countries that have lead to ‘‘de-contextualization’’ of the innovation policy discourse. open_innovation (Download the full text in PDF format)

Modernizing Russia: Round III Erik S. Reinert and Rainer Kattel

Looking at Russian economic dynamics through evolutionary and Schumpeterian Other Canon lenses, the authors provide alternative explanation as to why Russia is still lagging behind other BRIC and leading catching-up economies. In this context they argue that learning from successful cases of managing industrial policy under the WTO – what the rest of the BRIC economies have long been doing – is perhaps the main issue for Russia’s economic policy-making in the near future. Modernizing_Russia  (Download the full text in PDF format)

Rethinking Investment Provisions in Free Trade Agreements Smitha Francis

Developing country governments are increasingly resorting to comprehensive trade agreements involving profound commitments in public policy, which have wide-ranging adverse consequences on food security, industrial development, financial stability, etc. This paper analyses investment disciplines in FTAs in order to come to an understanding of their overall impact on a developing country FTA partner’s policy space, and therefore, on its development prospects. It is argued that given the links between trade and investment commitments within and across different FTAs, South-South FTAs have become as problematic as North-South FTAs. Rethinking_Investment_Provisions  (Download the full text in PDF format)

The Impact of Trade Liberalization and the Global Economic Crisis on the Productive Sectors, Employment and Incomes in Mexico Alicia Puyana

Analysing the impact of trade reforms on the performance of the Mexican economy, specifically in the aftermath of the crisis, the author discusses the advantages and disadvantages of liberalisation, gives concrete policy recommendations and identifies the role of development cooperation, particularly aid for trade, to improve Mexico’s post-crisis development strategies. incomes_mexico (Download the full text in PDF format)

Combining Bad Economics with Proto-geography Sumanasiri Liyanage

The article analyses a recently released World Bank report on Sri Lanka, titled, ''Sri Lanka: Connecting People to Prosperity''. It points out that the main weakness of the report stems from its neo-liberal premise that places market and market forces at a pre-eminent position. Further, it argues, that economic development anywhere in the world, with the exception of a handful of countries, has resulted from correct industrial policy rather than from unconditional faith in market forces. Combining_Bad_Economics (Download the full text in PDF format) (This article has appeared in The Island, 22 August 2010)