IGIDR Annual Report 2008-2009 - Indira Gandhi Institute of ...

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Research ActivitiesIn world commercial services export South Asiaapparently improved its share from 1.3 percent in 2000to 2.5 percent in 2006. This gives us a misleadingpicture of South Asian trade performance andessentially shows the improving trade performance ofthe large country India. We found that in merchandisetrade as well as commercial services South Asiaperformance excluding India is rather poor. This is amatter of serious concern because during this period(2000-06) world trade in manufactures and commercialservices was expanding and the Agreement on Textilesand Clothing (ATC) restrictions on China‘s textile andapparel exports were in place. In merchandise exports,the share of South Asia excluding India remainedstagnant at 0.3 per cent and in commercial services theshare declined from 0.19 percent to 0.17 per centbetween 2000 and 2006. We highlight the structuralweaknesses in South Asian exports. This calls forconcentrated government policy support for investmentin industrial upgrading in South AsiaFinancial EconometricsIn ―Volatility in Indian stock markets- A conditionalvariance tale re-told‖ (forthcoming in Journal ofEmerging market Finance), R. Krishnan and ConanMukherjee attempt to identify, from among the familyof GARCH models, the model that best describes theIndian stock market volatility, by (1) building volatilitymodels using the traditional GARCH models thataccounts for asymmetry;(2) selecting a suitable modelby nesting through Box-Cox transformation, a familyof GARCH models. The results confirm the stylisedfact of the presence of leverage effects in stock market.But contrary to popular belief, it shows that (1) it is thesmaller shocks that affect the returns in the Indianstock market and dominate the news impact curve thanthe large shocks (2) nesting exercise has narroweddown to two entirely different set of models that coulddescribe equally well the return process of the Indianmarket; but overall results indicate that a nonlinearmodel with an exponent that accounts for smallershocks may be preferable for Indian stock market. (3)Nontrading days account for a sizable portion in returnvariance, contributing almost one-fourth as much tovolatility as any trading day.Law and Economics―With the rise of markets, the importance of propertylaw, contract law, business law and corporation lawincreased. The same applies to those fields of the law,like regulatory law, consumer protection law and tortlaw, which correct failures of the market system.‖ Thebook ―Economic Analysis of Law in India: Theory andApplications‖ (Oxford University Press, forthcoming),edited by Babu P.G. (IGIDR), Eger, T. (Hamburg),Schaefer, H.B. (Hamburg), Somashekhar, T. (NLSBangalore), and Angara Raja (Hyderabad), is anoutcome of the cooperation between the Indira GandhiInstitute of Development Research (Mumbai), theCentral University of Hyderabad, the National LawSchool of India (Bangalore), as well as the lawfaculties of the Universities of Ghent (Belgium) andHamburg (Germany) under the auspices of EuropeanCommission‘s ―Asia Link‖ framework, is a first of itskind in the area of Law and Economics in India. Itbrings together several leading scholars such as RobertCooter, Hans-Bernd Schaefer, Thomas Ulen and SatishJain, to name a few, to address a number of broadissues of relevance to the Indian Law and Economicsscenario, focusing on: (a) financial institutions, (b)accident laws and environmental problems, (c) tradeagreements and intellectual property rights protection,(d) corruption and its effects, (e) the role of thejudiciary in fostering efficient enforcement of law, and(f) Law and Economic Development.The paper by P. G. Babu (IGIDR Mumbai) on ―Suitand Settlement under Asymmetric Information: TheCase of the Bhopal Gas Disaster,‖ in the abovementioned volume, models and analyses the famoussuit between the victims of the Bhopal gas tragedy andthe Union Carbide Corporation. The analysis relies oninsights from information economics and bargainingtheory. It corroborates theoretically predicted conflictsbetween individually rational actions/choices, on theone hand, and the collectively rational choices on theother hand. In addition, the paper highlights the22 Annual Report 2008-09
Research Activitiesconflicts among the objectives of the parties involved,which are akin to agency relations.The paper ―Governance of Natural Resources in India:Property Rights, Legal Pluralism and Other Issues‖ inN. C. Narayana ed. State, Natural Resource Conflictsand Challenged to Governance- Where Do We GoFrom Here? Academic Foundation, 2008, by NirmalSengupta, traces the evolution of legal andadministrative provisions pertaining to common poolresources in India in order to understand the currentstate and the sources of some major problems.Corporate GovernanceThe paper by Jayati Sarkar and Subrata Sarkar titled―Multiple Board Appointments and Firm Performancein Emerging Economies: Evidence from India,‖ PacificBasin Finance Journal, Volume 17, April 2009, 271-293, extends the literature on multiple directorships,busy directors and firm performance by providingevidence from an emerging economy, India, where theincidence of multiple directorships is high. Using asample of 500 large firms and a measure of "busyness"that is more general in its applicability; they findmultiple directorships by independent directors tocorrelate positively with firm value. Independentdirectors with multiple positions are also found toattend more board meetings and are more likely to bepresent in a company's annual general meeting. Thesefindings are largely in contrast to the existing evidencefrom the US studies and lend support to the "qualityhypothesis" that busy outside directors are likely to bebetter directors, and the "resource dependencyhypothesis" that multiple directors may be betternetworked thereby helping the company to establishmore linkages with its external environment. Multipledirectorships by inside directors are, however,negatively related to firm performance. The results ofthis paper suggest that the institutional specificities ofemerging economies like India could work in favour ofsustaining high levels of multiple directorships forindependent directors without necessarily impairing thequality of corporate governance.In the paper ―Board of Directors and OpportunisticEarnings Management: Evidence from India‖published in Journal of Accounting, Auditing andFinance, Vol. 23, No. 4, December, 2008, 189-208,Jayati Sarkar, Subrata Sarkar and Kaustav Sen (PaceUniversity, New York) investigate the impact of boardcharacteristics on opportunistic earnings managementin the context of a large emerging economy, India.While the role of company boards in earningsmanagement has been examined in developed marketssetting, particularly the US and UK, understandingtheir effectiveness in emerging markets like India isparticularly important due to differences that exist inthe structure of business organizations across thesemarkets. Using a sample of 500 large Indian firms, theyanalyse the effect of board independence on earningsmanagement as has been the focus of most existingstudies, and extend the existing literature by includingcharacteristics of directors that proxy for the ―quality‖of both inside and outside directors that are likely toimpinge on the effectiveness of boards in curbingearnings manipulation. Their results indicate that it isnot board independence per se, but rather board qualitythat is important for earnings management. Theirresults show that diligent boards are associated withlower earnings manipulation, while boards that havelarge number of multiple directors exhibit higherearnings management. With respect to inside directors,their results indicate that CEO-duality and presence ofcontrolling shareholders on the board increasesearnings management. They also find that domesticinstitutional owners, one of the key control variables,mitigate earnings management and acts as acompensating control mechanism to the presence ofcontrolling shareholders on corporate boards.The chapter by Jayati Sarkar titled ―Business Groups inIndia‖ (forthcoming in the Oxford Handbook ofBusiness Groups edited by Asli M. Colpan, TakashiHikino and James R. Lincoln, Oxford University Press)aims to examine the evolution of family businessgroups in India, one of the fastest growing emergingeconomies in recent times and a country whereIndira Gandhi Institute of Development Research 23
Page 3: ContentsPrefaceiiiOrganisation of I
Page 6 and 7: PrefaceRao, Chief Economist, Yes Ba
Page 8 and 9: PrefaceThe activities between IGIDR
Page 10 and 11: IGIDR at a GlanceEstablished in 198
Page 12 and 13: Research ActivitiesMacroeconomics a
Page 14 and 15: Research ActivitiesNachane, D. M. (
Page 16 and 17: Research Activitiesinflows; never m
Page 18 and 19: Research ActivitiesPolitical Weekly
Page 20 and 21: Research Activitiesand Farmers‘ S
Page 22 and 23: Research Activitiescatastrophic if
Page 24 and 25: Research ActivitiesIndustry and Lab
Page 26 and 27: Research Activitiesfor cooking (wit
Page 28 and 29: Research Activitiesand supporters o
Page 32 and 33: Research Activitiesbusiness groups
Page 34 and 35: ProjectsIGIDR faculty members under
Page 36 and 37: ProjectsExternally Funded Research
Page 38 and 39: Seminars/Workshops/Conferences at I
Page 40 and 41: Faculty ActivitiesAttended ―Works
Page 42 and 43: Faculty ActivitiesMary, University
Page 44 and 45: Faculty ActivitiesPal RupayanPresen
Page 46 and 47: Faculty ActivitiesDiscussant for pa
Page 48 and 49: Faculty ActivitiesSuryanarayana M.
Page 50 and 51: Faculty ActivitiesExternal thesis e
Page 52 and 53: Faculty ActivitiesTeaching: Microec
Page 54 and 55: Faculty ActivitiesSarkar SubrataRev
Page 56 and 57: Faculty ActivitiesLectures for Stud
Page 58 and 59: Faculty Research Publications‗Sig
Page 60 and 61: Faculty Research PublicationsNagara
Page 62 and 63: Faculty Research Publications―Tra
Page 64 and 65: Post-Doctoral FellowshipThe Post-Do
Page 66 and 67: Student Activities/Research Publica
Page 68 and 69: Student Research Topics (Ongoing)Sr
Page 70 and 71: Student Batch 2008-2009M.Phil/PhD S
Page 72 and 73: Visitors and Seminars1.4.2008 Dr. K
Page 74 and 75: Library and Information ServicesThe
Page 76 and 77: 6 th Convocation of IGIDRFrom left:
Page 78 and 79: Computer FacilitiesThe computer fac
Page 80 and 81:
Faculty and Areas of InterestGanesh
Page 82 and 83:
Appendix: Financial StatementDetail
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