scholarly journals A Measure of the Elasticity of Substitution in the Manufacturing Sector of Pakistan

2001 ◽  
Vol 6 (2) ◽  
pp. 43-56
Author(s):  
Rukhsana Kalim
Keyword(s):  
Large Scale ◽  
Manufacturing Sector ◽  
Industrial Sector ◽  
Elasticity Of Substitution ◽  
Factor Price ◽  
Capital Goods ◽  
Employment Potential ◽  
The Empirical Analysis ◽  
Price Distortions

From a technological perspective, the paper is mainly concerned with finding the employment potential in different groups of industries of Pakistan. The role of factor prices in determining techniques of production in the industrial sector through elasticity of substitution has been analysed. Besides taking the large-scale manufacturing sector as a whole, three broad categories of industries viz., consumer goods, intermediate goods and capital goods industries has been selected in particular for the empirical analysis. By utilising the OLS technique, the cross-section analysis for the year 1995-96 has been made. Our results indicate the there is great potential for employment in the intermediate and capital goods industries provided there are no factor price distortions in the economy.

Government Policy, Factor Market Distortion and Structural Transformation

2020 ◽  
Vol 5 (3) ◽  
pp. 101
Author(s):  
Jianfang Liu
Keyword(s):  
Structural Transformation ◽  
Technological Progress ◽  
Service Industry ◽  
Income Elasticity ◽  
Manufacturing Sector ◽  
Factor Price ◽  
Agricultural Labor ◽  
Tax Rate ◽  
The Relationship ◽  
Price Distortions

<p>Demand-driven economic structural transformation is mainly realized through the Engel Effect, and different consumption has different income elasticity. This article attempts to explain the effects of taxation, technological progress and factor price distortions on economic structure by introducing government policies and capital labor price distortions into the multi-sectorial model. The results showed that the share of agricultural labor decrease when the tax rate decreased or technological progress occurred and the share of service labor increased when the non-homothetic of utility function was stronger. Similarly, the distortion of capital and labor factor prices will also affect the structural transformation, and the relationship between the two is opposite. When the distortion of manufacturing sector factor prices increases, the structural transformation will be accelerated. However, the structural transformation slows down as the distortion of factor prices in service industry increases.</p>

scholarly journals REVIEW PAPER ON PERFORMANCE ENHANCMENT OF FOUNDRY INDUSTRY BY ENERGY CONSRVATION ANALYSIS.

2020 ◽  
Vol 9 (11) ◽  
pp. 46-51
Keyword(s):  
Large Scale ◽  
Energy Use ◽  
Energy Intensity ◽  
Small And Medium Enterprises ◽  
Industrial Sector ◽  
Energy Utilization ◽  
Economic Downturn ◽  
Critical Issues ◽  
Employment Potential ◽  
Medium Enterprises

Micro, Small and Medium Enterprises (MSMEs) have been accepted as engines of economic growth to promote and accelerate equitable development worldwide. The major advantage of this sector is its enormous employment potential which constitutes around 90% at significantly low capital involvement. In recent years the sector has consistently registered higher growth rate as compared to the overall industrial sector. With its agility and dynamism, the sector has shown admirable innovativeness and adaptability to survive the recent economic downturn and recession. However, despite the significant contributions made towards various aspects of the nation’s socio-economic scenario, this sector too faces several critical issues that require immediate attention. One such factor that falls under this text is the prevalence of age old technologies across the sectors and inherent inefficiencies associated with resource and energy utilization. As a result of increasing awareness towards efficient usage of energy and other resources, there has been a visible reduction in energy intensity but still studies conducted on the MSME sector reveal that the energy intensity per unit of production is much higher than that of the organized large scale sector. Most foundry units which are highly energy intensive fall under MSME category in India. India produces 12.24% of global casting at present. If energy intensity per unit production of MSME is to be brought closer to that of organized large scale sectors then energy conservation is the only way that can do so with efficient use of energy and steep rejection of energy wastage without suppression of demand for energy use.

scholarly journals Efficiency of Large-scale Manufacturing in Pakistan: A Production Frontier Approach

2006 ◽  
Vol 45 (4II) ◽  
pp. 689-700 ◽  
Author(s):  
Tariq Mahmood ◽  
Ejaz Ghani ◽  
Musleh-Ud Din
Keyword(s):  
Trade Policy ◽  
Large Scale ◽  
Manufacturing Sector ◽  
Import Substitution ◽  
Industrial Sector ◽  
Global Market ◽  
Early Years ◽  
Policy Reforms ◽  
Market Place ◽  
Production Frontier

The large scale manufacturing sector in Pakistan has gained increasing prominence over the years with its share in output rising to about 13 percent in 2005-06 from 5.67 percent in 1959-60.1 The sector has operated amid varying policy environments ranging from outright import substitution in the early years to a more deregulated and liberal environment in the recent years driven largely by concerns to improve the efficiency of the industrial sector which is critical for attaining greater competitiveness. While industrial and trade policy reforms in recent years have exposed domestic enterprises to greater internal and external competition, most of these enterprises continue to seek state patronage and have yet to reposition themselves to compete effectively in the global market place. Furthermore, the trade policy still has an import substitution bias for certain critical sectors whose imports are subject to tariff peaks and this raises concerns on their efficiency. This study aims to assess the efficiency of large scale manufacturing sector in Pakistan using the production frontier approach. Section 2 reviews the literature while Section 3 sets out the methodology and discusses data employed in the study. Section 4 analyses empirical findings, and Section 5 concludes the discussion.

Determinants of Exports Behaviour of India’s Agro-processing Firms: Role of Technology, Imported Raw Materials and Logistics Infrastructure

2021 ◽  
pp. 097226292098144
Author(s):  
Suresh Ramaiah ◽  
Gopal Krishna Roy
Keyword(s):  
Raw Materials ◽  
Manufacturing Sector ◽  
Sample Selection ◽  
Export Intensity ◽  
Capital Goods ◽  
Exporting Firms ◽  
Export Behaviour ◽  
Materials Used ◽  
Managerial Quality

Despite accounting for a sizeable share in the overall output and employment of the manufacturing sector, the export potential of India’s Agro-processing firms has received less attention. This article investigates the determinants of export propensity and intensity of relatively labour-intensive agro-processing firms in India with a focus on the role of technology adopted, the proportion of imported raw materials used and status of the logistics infrastructure at the location of the firm. The article makes use of the CMIE-PROWESS dataset to obtain a cross-section of agro-processing firms for the year 2016–2017 and the Logistic Ease Across Different States (LEADS) database. The empirical strategy involves the Heckman two-step process to address the sample selection bias originating in modelling export behaviour. The article finds that the likelihood of an agro-processing firm to enter the exporting market increases with an increase in technology enhancing investment in terms of expenditure on research and development and import of capital goods. Moreover, a better level of logistics infrastructure enhances the likelihood of exporting. The likelihood of a firm to export also increases with the increase in the use of imported raw materials, firm size, age and superior managerial quality. However, the paper finds only the expenditure on imported capital goods and imported raw materials to be positively and significantly associated with the export intensity of the exporting firms.

scholarly journals The Role of Small-scale Industry in Pakistan's Economy and Government Incentives

1986 ◽  
Vol 25 (4) ◽  
pp. 789-807
Author(s):  
Muhammad Hussain Malik ◽  
Aftab Ahmad Cheema
Keyword(s):  
Economic Development ◽  
Industrial Policy ◽  
Large Scale ◽  
Manufacturing Sector ◽  
Small Scale ◽  
The Past ◽  
Small Scale Industry ◽  
Small Industry ◽  
The Government

Despite the recognition of the importance of small-scale industry, the Government of Pakistan's industrial policy has been biased in the past towards the large-scale manufacturing sector. The First Five Year Plan (1955-60) document states the significance of small-scale industry in the following words. Small industry has specific contributions to make to economic development. In the first place, it can contribute to the output of needed goods without requiring the organization of large new enterprises or the use of much foreign exchange to finance the import of new equipment. Secondly, it can provide opportunities for employment beyond the narrow boundaries of urban centres. Finally, as history shows, it can perform an important function in promoting growth, providing training ground for management and labour, and spreading industrial knowledge over wide areas [8, p. 471] .

scholarly journals An Analysis of Production Relations in the Large-scale Textile Manufacturing Sector of Pakistan

1989 ◽  
Vol 28 (1) ◽  
pp. 27-42 ◽  
Author(s):  
Sohail J. Malik ◽  
Mohammad Mushtaq ◽  
Hina Nazli
Keyword(s):  
Large Scale ◽  
Manufacturing Sector ◽  
Returns To Scale ◽  
Manufacturing Industries ◽  
Elasticity Of Substitution ◽  
Production Structure ◽  
Textile Manufacturing ◽  
Production Relations ◽  
Employment Generation ◽  
Constant Returns To Scale

This paper attempts to determine econometrically the underlying production relations for the large-scale textile manufacturing sector of Pakistan, based on data available from the siX most recent censuses of large-scale manufacturing industries. The cOllariance model is used for pooling the provincial data. Testing for alternative forms reveals that the CES production function with constant-returns-to-scale most adequately explains the underlying production structure. The estimates of the elasticity of substitution are significantly different from zero in all cases, implying significant and efficient employment generation possibilities.

Substitution Elasticities in the Large-Scale Manufacturing Industries of Pakistan - A Rejoinder

1982 ◽  
Vol 21 (2) ◽  
pp. 159-168
Author(s):  
A. R. Kemal
Keyword(s):  
Developing Countries ◽  
Large Scale ◽  
Manufacturing Sector ◽  
Manufacturing Industries ◽  
The Other ◽  
Production Functions ◽  
Elasticity Of Substitution ◽  
Substitution Elasticities

Estimates of the elasticity of substitution between capital and labour in 16 manufacturing industries and the manufacturing sector of Pakistan as a whole were reported in [18]. In most of the industries and the manufacturing sector as a whole substitution elasticities were found to be rather low. In the Spring 1982 issue of this Review, Ahmed {I] has suggested that the estimates of substitution elasticities may have been biased downwards due to the irrelevance of production functions in the developing countries and the nature of data employed in the study. He also believes that the evidence we presented regarding low substitution elasticities in the other developing countries was selective because according to him Morawetz [23J provides evidence to the contrary. Furthermore, he argues that low substitution elasticities are inconsistent with the declining share of labour in the output. In the following, without being drawn into polemics, we shall show that Ahmed's comments are a result of his misunderstanding and misinterpretation of our study.

scholarly journals Public Policy and Changing Pattern of Industrial R&D System in India: A Comparative Analysis of Pre- and Post-reform Periods

2020 ◽  
Vol 5 (1) ◽  
pp. 103-122
Author(s):  
Baldev Singh Shergill
Keyword(s):  
Public Sector ◽  
Private Sector ◽  
Low Income ◽  
Manufacturing Sector ◽  
Labour Force ◽  
Industrial Sector ◽  
Technological Capabilities ◽  
Capital Goods ◽  
The Public ◽  
Reform Period

This article is an attempt to examine the trends of industrial R&D expenditure by the private sector and public sector during pre-reform (1980–1992) and post-reform period (1993–2010). The agenda of economic reform is to liberalise the industrial sector and make it more competitive in the global scenario. The analysis indicates that in the post-reform period, the percentage share of R&D expenditure drastically shifted from public sector to private sector. The major share of R&D expenditure remained in capital goods manufacturing sector. R&D expenditure is highly concentrated in the capital goods sector by public and private sectors. Second, preferential sector in terms of share of R&D expenditure has been intermediate sector by the public sector and consumer non-durables by the private sector overtime. Consumer durables sector is a completely ignored sector across the board. R&D intensity has been in the range of low and medium across industry groups and time. It may be argued that industries might not be enabling to realise spillovers from the transfer of technology and also would be fragile to enhance its ability to make product and process innovations of its own. The changing pattern of R&D expenditure by the industrial sector confirms the supremacy and autonomy of the market. These are the areas where R&D expenditure is required to gain technological capabilities and absorptive capacity for a low R&D intensity country like India. The article argues that technological and industrial policies should be taken into consideration with respect to the demand and production processes. Especially since the Indian economy is a low-income country with a massive agrarian and rural labour force, it needs to transform technological capabilities and organisation of industrialisation according to the indigenous and categorised necessities by both the public and the private sectors.

Substitution Elasticities in the Large-Scale Manufacturing Industries of Pakistan: A Comment

1982 ◽  
Vol 21 (1) ◽  
pp. 73-82 ◽  
Author(s):  
Meekal Ahmed
Keyword(s):  
Developing Countries ◽  
Production Function ◽  
Large Scale ◽  
Manufacturing Industries ◽  
Function Approach ◽  
Factor Price ◽  
Production Function Approach ◽  
Basic Production ◽  
Substitution Elasticities ◽  
Price Distortions

In the Spring 1981 edition of this Review, A.R. Kemal presented evidence on 'substitution elasticities', estimated over the period 1960-70, in sixteen two-digit manufacturing industries in Pakistan [8]. After applying several variants of the basic 'production function' approach, the author argued that the elasticities of substitution in Pakistan were generally low and/or insignificant and therefore a manifestation of Pakistan's 'technological dependence'; that these results are 'consistent' with similar estimates for other developing countries; and that because of the low value of the elasticities, the removal of factor price distortions, while necessary to the attainment of a more labour-intensive pattern of development, needs to be supported by policies aimed al subsidizing the developing of indigenous technologies.

scholarly journals Production Relationships in Pakistan's Manufacturing Industries

1976 ◽  
Vol 15 (4) ◽  
pp. 406-423 ◽  
Author(s):  
Shahnaz Kazi ◽  
Zahira Saleem Khan ◽  
Seemin Anwar Khan
Keyword(s):  
Social Cost ◽  
Manufacturing Sector ◽  
The United States ◽  
Industrial Sector ◽  
Elasticity Of Substitution ◽  
Factor Endowments ◽  
Production Techniques ◽  
Factor Markets ◽  
The One ◽  
Labour Absorption

Despite the fact that there are great disparities in factor endowments, techniques employed in the manufacturing sector of underdeveloped labour surplus countries are comparable to those of highly industrialized capital -abundant countries like the United States. A.R. Khan in his paper on capital intensities and factor use [13] concluded from an international comparison of factor intensities that Pakistani capital intensities are near the American level in a number of industries while in some cases they are even higher. Explanations of this paradox are based on two different assumptions regarding the magnitude of the elasticity of substitution between capital and labour. On the one hand it is assumed that the elasticity of substitution and thereby the possibility of labour absorption via changes in factor prices are very limited due to the dominance of techniques borrowed from the West and oriented to the needs of capital rich nations. On the other hand, significant substitution possibilities are assumed in production techniques and the presence of high capital intensities in the industrial sector is attributed to distortions in the factor markets in the form of exchange rate regulations, low rates of bank borrowing, etc., which lead to the price of capital being much lower than it's social cost.

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