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Begin New Search Political Geography India Content Type Working Paper Publishing Institution United Nations University

11. Profit-shifting behaviour of emerging multinationals from India

Author:
Khanindra Ch. Das
Publication Date:
02-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper examines the profit-shifting behaviour of emerging multinational firms from India. It is found that the before-tax profitability of subsidiaries differs according to whether they were established directly or via an Offshore Financial Centre (OFC). The impact of the corporate tax rate on profitability is examined using a fixed-effects model for the period 2010–19. In the case of subsidiaries established via OFCs, a negative relationship between corporate tax rate and profitability is found, indicating profit-shifting behaviour. However, a disaggregated investigation by characteristics of parent firms reveals that the negative relationship holds primarily for via-OFC subsidiaries that belong to multinational firms with limited transactions of intangible assets, lower export intensity, and limited dependence on external commercial borrowing. The evidence of profit shifting is not all pervasive. However, in the presence of these transaction channels, multinational firms establish better control over intra-firm resources, which enables the transfer of resources within the multinational firm when the network of subsidiaries is connected through the OFC. The results are robust to the inclusion of economic and institutional factors pertaining to the host country.
Topic:
Finance, Multinational Corporations, Profit, Corporate Tax, and Tax Havens
Political Geography:
South Asia and India

12. Tax provisioning by extractive industry multinational subsidiaries

Author:
Khanindra Ch. Das
Publication Date:
11-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Extractive industries are spread across mining of metal and minerals, oil and gas, among others. Multinationals in these sectors are confronted with different challenges ranging from corruption, political risk, economic uncertainty, sunk costs, and the long-gestation periods to execute projects. As a result, tax payment behaviour of subsidiaries in the extractive sector could be dependent not only on these factors, but also on the life cycle of the subsidiary, profitability, and holding structure. Furthermore, emerging economy multinationals in the extractive industries could be state-owned and may invest in foreign subsidiaries for strategic reasons. We examine tax provision in host countries by India’s multinational subsidiaries in the extractive industry. Panel data analysis is carried out for the period 2010–20. It is found that tax provision remains lower in the initial years of subsidiary life and increases with the sustenance of subsidiary in the host country for a longer period. In addition, subsidiaries of public sector enterprises are found to have higher tax provisions than their private counterparts. When it comes to the determinants, economic policy uncertainty, corruption, and political stability are found to significantly affect tax provision.
Topic:
Corruption, Political stability, Multinational Corporations, Tax Systems, Economic Policy, Public Sector, Extractive Industries, and Uncertainty
Political Geography:
South Asia and India

13. Marriage market responses in the wake of a natural disaster in India

Author:
Shreyasee Das and Shatanjaya Dasgupta
Publication Date:
11-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper examines the impact of the 2001 Gujarat earthquake on age at marriage and other assortative matching outcomes. Using the 2004–05 wave of the India Human Development Survey and employing a difference-in-differences strategy, we document that the earthquake reduced the age at marriage for both men and women and decreased the likelihood of women marrying into wealthier households. Additionally, we find no changes in matching by educational status or in the likelihood of intra-caste and out-of-village marriages. The results are driven by districts that were severely affected by the earthquake in terms of deaths and destruction. Our conjecture is that the negative economic shock pushed parents to marry off their daughters early to save on dowry expenditures. We confirm this underlying mechanism by using a proxy for dowry payments. Our results highlight how the institution of marriage can induce long-lasting demographic changes after a natural disaster.
Topic:
Natural Disasters, Marriage, Earthquake, and Dowry
Political Geography:
South Asia and India

14. The legal basis for affirmative action in India

Author:
Kiruba Munusamy
Publication Date:
07-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The affirmative action policy in India came into practice because of the generations of struggle undergone by the untouchable castes and other backward classes, who were historically excluded from education and administration. As society changed, it was inevitable that the vulnerable groups who had so far been forgotten in terms of social justice should be ‘included’. However, this paper finds that, instead of recognizing this need the judiciary continued to apply illogical limitations and age-old precedents that disrupted the implementation of affirmative action. Although the legal basis of affirmative action comes from the Constitution of India itself, which provides for reservation and enables States to make laws to that end, judicial interference has necessitated ongoing legislative changes to keep the needed affirmative action on track. Progress has been made, but it is often a case of ‘two steps forward, one step back’, and many issues, such as the ceiling on reservations and the categories to be included in it, remain to be resolved.
Topic:
Inequality, Social Justice, Judiciary, and Affirmative Action
Political Geography:
South Asia and India

15. The gendered crisis: livelihoods and mental well-being in India during COVID-19

Author:
Farzana Afridi, Amrita Dhillon, and Sanchari Roy
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper studies the impact of the COVID-19 crisis on the gendered dimensions of employment and mental health among urban informal-sector workers in India. First, we find that men’s employment declined by 84 percentage points post-pandemic relative to pre-pandemic, while their monthly earnings fell by 89 per cent relative to the baseline mean. In contrast, women did not experience any significant impact on employment post pandemic, as reported by their husbands. Second, we document very high levels of pandemic-induced mental stress, with wives reporting greater stress than husbands. Third, this gendered pattern in pandemic-induced mental stress is partly explained by men’s employment losses, which affected wives more than husbands. In contrast, staying employed during the pandemic is associated with worse mental health for women and their (unemployed) husbands. Fourth, pre-existing social networks are associated with higher mental stress for women relative to men, possibly due to the ‘home-based’ nature of women’s networks.
Topic:
Gender Issues, Employment, Mental Health, COVID-19, Informal Economy, and Social Networks
Political Geography:
South Asia and India

16. Income and consumption inequality in China: A comparative approach with India

Author:
Carlos Gradín and Binbin Wu
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
We analyse income and expenditure distribution in China in a comparative perspective with India. These countries represent extreme cases in the relationship of inequality to both wellbeing indicators. Income is more highly concentrated than expenditure in India, especially at the top of the distribution. Both types of inequality are similar in China, although expenditure is more unequally distributed than income in urban areas. China has a much stronger correlation in individual ranks and levels between the two wellbeing distributions. As a result, expenditure inequality is higher in China than in India, but income inequality much lower. This results partially from differences in population composition, such as China being more urbanized and having smaller households, but mostly from differences in conditional income distributions, especially by attained education of the household head. We show that hybrid measures of wellbeing combining income and expenditure can be useful for such cross-country comparison.
Topic:
Inequality, Income Inequality, and Consumerism
Political Geography:
China, South Asia, India, and Asia

17. Beyond Industrialization: New Approaches to Development Strategy Based on the Service Sector

Author:
Peter Sheehan
Publication Date:
05-2008
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Industrialization occupies a central place in the rich tapestry of development theory and practice. Although that place has varied over time, many have agreed with Nicholas Kaldor that the kind of economic growth that leads to high real income per capita can only occur through industrialization. This paper argues that it is becoming increasingly difficult for most developing countries to achieve rapid growth through industrialization, and especially through export oriented activities. But the key mechanisms seen as driving the industrial take-off in much of the literature (internal increasing returns, transfer of labour into higher value activities and pecuniary externalities) are alive and well, and are evident in services as well as in industry. Furthermore, China is actively trying to move from a strategy based on industrialization to one based much more on agriculture and services, as the costs of the current pattern of industrialization become prohibitive, and India has demonstrated that rapid growth based primarily on the services sector is possible. Thus more attention needs to be given to strategies based on the expansion of the agricultural and services sectors, and to the ways in which better services in rural areas and higher rural output can combine to achieve rapid growth and improved human welfare in poor countries.
Topic:
Development
Political Geography:
China, India, and Asia

18. Comparing Regional Development in China and India

Author:
Yanrui Wu
Publication Date:
02-2008
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Economic growth in China and India has attracted many headlines recently. As a result, the literature comparing the two Asian giants has expanded substantially. This paper adds to the literature by comparing regional growth, disparity and convergence in the two economies. This is the first of its kind. The paper presents a detailed examination of economic growth in the regions of China and India over the past twenty years. It also provides an assessment of regional disparity in the two countries and investigates whether there is any evidence of regional convergence during the period of rapid economic growth. It attempts to identify the sources of regional disparity and hence draw policy implications for economic development in the two countries in the near future.
Topic:
Development
Political Geography:
China, India, and Asia

19. Development Path of China and India and the Challenges for their Sustainable Growth

Author:
Yuefen Li and Bin Zhang
Publication Date:
04-2008
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The segmentation of global manufacturing and services provided China and subsequently India with a golden opportunity to make full use of their absolute advantage—low cost yet educated labour—to integrate into the world economy within a comparatively shorter period of time than some earlier industrialisers. Though international trade functioned as a vent of surplus in view of the narrowness of their domestic markets at the beginning of their economic catch-up, the label of export-led model may not reflect the real picture as imports underwent dramatic increases during their respective growth periods, in particular for China. Foreign direct investment has played a pivotal role in their economic growth and has major presence in international trade and investment in leading sectors of both countries, giving rise to certain special features and weak links for their economic expansion and sustainability of fast economic growth. To maintain more broad-based, fast and balanced growth, it seems that both countries have to redress sectoral imbalances, encourage technology upgrading and cope with future changes in demographic profiles which constituted a trigger to fast economic growth at the time of their respective economic reform.
Topic:
Development and International Trade and Finance
Political Geography:
China, India, and Asia

20. Export Productivity, Finance, and Economic Growth: Are the Southern Engines of Growth Different?

Author:
Alessandra Guariglia and Amelia U. Santos-Paulino
Publication Date:
03-2008
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Using a panel of 139 countries over the period 1992-2003, we analyse the links between export productivity, economic growth and financial development indicators. We then investigate whether the links observed in China, India and Brazil systematically differ from those observed in other countries in the sample. We find that both GDP per capita and investment generally exert a positive and significant effect on export productivity. Except for Brazil, financial development is not an important determinant of export productivity. Moreover, except for Brazil, export productivity plays a positive effect on growth, and so does financial development for both China and Brazil, but not for India. Finally, in both India and Brazil, FDI is negatively associated with growth.
Topic:
International Trade and Finance
Political Geography:
China, India, Asia, Brazil, and South America