Competitiveness of exports: a micro-level approach
Abstract
IN their article,' Samuel Paul and Vasante Mote conclude that ". . . it
would seem that the competitiveness of the majority of products under
study has been seriously affected by the pressure of internal demand operating
in India." 2 The authors eventually state that the evidence suggests that a decline in domestic demand will improve an industry's export performance.
The purpose of this note is to comment on:
1. The theoretical framework in the article, especially the lack of
any clear predictions of the relationship between exports and domestic
demand at the micro-level.
2. The authors' tests of the pressure hypothesis (the effect on exports
of the pressure of domestic demand).
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