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Working Papers | 1994

Democratic Transition and the Challenge of Transformation

Giri Ananta

Ours is an age of democracy. Democracy as a form of government, characterized by elections and the installation of a “representative government, has been becoming a global phenomenon. The fall of the socialist world and domestic and global changes in Latin America, Africa, and Middle East have brought democracy to places and shores where it was undreamt of a few years ago, giving people a taste of freedom. But the globalization of democracy as a form of more legitimate representative government has not been accompanied by genuine efforts to tackle the problems of democracy (such as the tension between equality and liberty, the dictatorship of the majority, the actual as well as manufactured disinterest on the part of the so-called citizens not to participate in the electoral process resulting in as much as 50% of them not fulfilling their constitutional obligation to vote – the problems highlighted by no other than the most thoughtful observer of democracy as a practice, Alexis de Tocqueville--) and to widen the universe of democracy in accordance with the historical changes taking place in social systems as well as in the light of a desired agenda of transformation. The present paper aims at presenting some of the crucial gaps in the theory and practice of democracy and suggests the way we can rethink democracy as a prelude to and a model of a genuine transformative engagement.

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Working Papers | 1994

Analysis of the Indian Securities Industry: Market for Debt

Samir K. Barua, Ragunathan V, Jayanth R. Varma, and Venkiteswaran N

Though the Indian equity market has shown some encouraging growth in the last decade, the Indian debt market has continued to remain sluggish. In an environment where India is keen to attract foreign investments, it will be imperative to develop the secondary market for debt. This study, commissioned by USAID and the Centre for Analysis Information and Studies, New Delhi, takes a comprehensive look at the Indian private corporate debt market, the public sector bond market, the Government securities market, the housing finance and other debt markets. Recommendations have been made in two parts; braod recommendations for the development of the debt market as a whole and specific recommendations for the development of various segments of the debt market. Recommendations covering the entire debt market, cover integration between the regulated market and the free market, market making for financing and hedging options, interests rate derivatives and tax reforms. Segment-wise recommendations include corporate debt market, PSU bond markets, Government securities market, housing finance and securitisation, new instruments and bond market services.

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Working Papers | 1994

A Framework for Analysing-Consumer Orientation of Biotechnologists

Moorthy Janakiraman

Evaluation of agricultural technology development and commercial product development revealed that only a small percentage of the new products developed have succeeded in the market. Analysis of the reasons for product success or failure showed that the major factor was a poor understanding of consumer needs by the people involved in the product development. In other words lack of 'consumer orientation' of scientists could be the major reason for failure of many products. Consumer orientation is defined by four dimensions. They are [1] information generation from consumers, [2] provision of information to the consumers, [3] integration of different functional areas, and [4] Responsiveness to the needs of the consumers. If consumer orientation and product success are assumed to be positively correlated, then the process which increase the consumer orientation of scientists need to be spelt out. Scientists deal with different consumers participating in the process of product development. These consumers can be clubbed into two groups based on the level of control that organization can have on them, [1] those who are inside the organization, called 'internal consumers' and [2] outside the organization, referred as 'external consumers'. These consumers have preferences for various product attributes which may be complimentary, or contradictory. Presence of a long chain of consumers and contradicting attribute preferences could complicate the process of defining the product attributes. Incorporating the attributes of those who really consume the product may become even more difficult. Because, many who articulate one set of attributes may actually not consume the product. Scientists have to devise ways to decide which preferences to be taken into account, how much and in what sequence. Further, the production, distribution, and utilization process may also generate externalities for various systems. For example, replacement of chemical pesticides by biological products such as B thuringiensis, NPV, and other plant derivatives could generate a positive externality for farmers, end users and ecological systems, and the pesticide firm may consider it as a negative externality for them. Hence, the nature of externality could develop support or opposition from the clients based on their perception and the actual impact of the product on them. Consumer orientation in an organization could depend on two major factors. viz – [1] scientists-specific factors such as their interest in type of problems, background, etc., and [2] organizational-specific factors such as performance evaluation criteria used, the incentive and disincentive mechanisms used and the perception and preferences of individual scientists about these mechanisms. In the present investigation our objectives are to explore the differences in the consumer orientation process between successful and less successful products and to understand the influence of scientist-specific, and organizational-specific variables on the consumer orientation process. We expect that this study could throw new insights about the process and factors influencing scientists consumer orientation. The findings could help in developing policy measures to influence the behaviour of the scientists to get closer to the consumers, listen to their voice and look beyond.

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Working Papers | 1993

Drop Out, Enrollment and Poverty: Policy Implications

Vijaya Sherry Chand and Shukla Shailesh R

Debate around the factors responsible for the drop-out phenomenon in elementary education focuses largely on two positions: (a) that parents, under economic compulsions, tend to “withdraw” their children from school, (b) that the schools themselves tend to “eliminate” certain kinds of pupils. The first position dominates the debate and tends to focus on factors external to the educational system. It adopts a macro socio-economic perspective and fits in well with the concern over the quantitative performance of the elementary education system. The more critical second position also adopts a macro perspective, reflecting, however, on the system of education itself, its pedagogical practices, content and institutions. It may be argued that the continued focus on quantitative measures like drop out and enrollment is misplaced. Yet, for better focussing of educational reform, a synthesis of both these approaches is called for. Firstly, enrollment and drop-out data can be used to identify micro-locations which are – educationally speaking – 'problematic'. Such locations may show high enrollments but poor educational performance and correspond to the ecologically high-risk and bio-diverse pockets. Policy intervention should focus specifically on the 'quality' of schooling in these areas. The paper concludes that the correspondence of poor educational performance with poverty of a particular nature that exists in these environments has to be recognized in order to facilitate a shift of educational planning from centralized and uniform policies towards innovative localized approaches.

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Working Papers | 1993

SEBIs Regulatory Priorities: Need for Change

Jayanth R. Varma and Samir K. Barua

Genesis and Function: SEBI was created in 1988 to reform and regulate the securities markets in India. It was given statutory powers in 1992 and assigned the following functions and responsibilities: · Make rules and regulations for various agencies connected with the securities markets. · Supervise and monitor the functioning of these agencies, including stock exchanges, to ensure that they follow the rules. · Protect investors from fraudulent and unfair trade practices. · Conduct necessary research for its function and undertake education and training of investors and intermediaries. Reforms and Impact: the two main areas where SEBI took initiative after receiving statutory powers were: a) making rules for financial intermediaries, b) supervision and monitoring of functioning of stock exchanges. The reforms initiated by SEBI have met with only limited success. The main reasons for this are: · The reforms are piecemeal and do not fit into a larger cohesive plan of action. · The reforms are hastily conceived and implemented, without adequate time and effort being spent on wider consultations and feedback form market participants and experts. · The reforms attempt to make minor changes in the current antiquated method of operation of the markets, which create more friction and confrontation and little real benefit it terms of making markets more efficient. Need for New Focus: The mission of SEBI needs to be reinterpreted as making the Indian securities markets informationally more efficient. This implies that SEBI should attempt to ensure that: · Reliable information is available to all market participants with increasing frequency. · The cost of transactions in the market is reduced and the ease of transactions is improved. Achieving the Mission: A Radical departure from the current method of functioning is needed to achieve the new mission. The strategic shift in SEBI's plans would involve the following: · Giving top priority to use of Information Technology to bring in scrip-less trading and computerized clearance and settlement trading systems. · Bringing the accounting and corporate disclosures standards on par with standards in the developed securities markets. · Restructuring the markets to achieve an integrated, automated system of trading in all types of securities to ensure best possible service to all investors through greater competition and improved dissemination of information. · Professionalizing the financial analysts function through training programmes. · Changing the staffing pattern of SEBI by recruiting professionals rather than depending on personnel on deputation from various government departments. Role of the Government: To ensure that SEBI does not get degraded by personal ambitions and the pressure of the larger system, the government must do the following: · Clearly define the role and jurisdiction of the various agencies that have supervisory and regulatory authority over various aspects of the securities industry. · Change the composition of the Board to include experts from the field of finance, accounting and economics. · Ask SEBI to prepare a five year perspective plan with details about reforms contemplated and their schedule of implementation.

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Working Papers | 1993

How Firms Make Technological Improvement: Observation from a Field Study

Ramanarayan S

The paper presents observational data impressionistic accounts emerging from a study aimed at understanding the determinants of technological dynamism, and the role that publicly funded technology institutions play in facilitating product or process innovations in industrial firms. The study covered 23 foundries, 13 polymer units, and 3 technology institutions. Firms were found to obtain new technologies largely through foreign collaborations. They focused their technology efforts on assimilation of technology and adaptation for local conditions or local volumes. Several factors were found to be inhibiting technology development efforts: short term planning horizons of the management; perceived absence of connection between technological sophistication and commercial success; inadequate attention to development of markets to utilize the benefits flowing from technology development; high costs of modernization; and absence of reliable quality inputs and infrastructure which keeps managers mired in routine, survival concerns. The study identifies some factors which contributed to technological fervour: inclusion of technology concerns on the management agenda and conscious attention to technological aspects; processes and mechanisms for encouraging technological innovation; attention to linkage and integration processes to institutionalize technological changes; upgradation of technological capability through careful HRD efforts; new and exciting corporate strategies that can serve as frameworks for technology plan; and active networking with technology institutions, suppliers, customers, industry associations etc. The paper examines the implications of the findings for roles of senior managers. To meet the technological challenges, two sets of roles become very important: entrepreneurial role that is aimed at discovering new possibilities and displaying high level of initiative to implement innovations, and leadership role that is oriented to meeting the needs of change by mobilizing and energizing members toward a common vision.

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Working Papers | 1993

An Axiomatic Characterization of the Lexicographic Utilitarian Collective Utility Function

Lahiri Somdeb

In this paper we axiomatically characterize the family of lexicographic utilitarian collective utility functions. As a by-product we obtain the utilitarian collective utility function by imposing a shift anonymity condition. Finally we axiomatically characterize the family of rank k-dictator collective utility functions, as a corollary to or main characterization theorem.

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Working Papers | 1993

Quasi-Utilitarian Choice Function for Multiattribute Choice Problems

Lahiri Somdeb

This paper was written when I was visiting the Centre for Research in Economics and Statistics (CREST), ENSAE (France) during November and December 1993 on a French government fellowship. I would like to thank my hosts for the congenial research environment which made writing this paper possible.

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Working Papers | 1993

Indian Economic Forecast 1 December, 1993

Rastogi A B

The government has begun preparing the people for the second phase of reforms by frequently pointing out that the next phase of reforms would be harsher but enrich their lives later. The tougher decisions about liberalisation in the field of labour law, agricultural reform and privatisation are still on anvil. The budget is not going to set the markets sizzling. It is widely expected that the next budget would be investor friendly and corporate sector would be given more importance this year. Markets are already discounting that and reaching new heights. Our growth forecast for 1993-94 remains at 4.2% and inflation rate (WPI) around 7.6%. However, balance of payment scenario has changed markedly in medium term as a result of lower crude oil prices, exceptional growth in exports and foreign investments. In medium term, GDP is expected to grow above 6.5% while inflation remains around 6%.

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Working Papers | 1993

Endogenous Technological Innovation for Sustainable Development: The Case of Agriculture Pest Management

Pastkaia A R

With growing pressure from environmental movements, governments are being forced to rethink policies from the view-point for Sustainable Development (SD). SD would enable societies/communities to maintain if not augment the very natural base on which they subsist. The costs of such development would not be externalized either over time or nature. The transition to SD calls for (a) supply of technological, institutional and cultural innovations and (b) suitable policy that would draw upon these innovations while facilitating the emergence of further innovation. Certain characteristics of SD innovations set them apart from conventional ones: a) they tend to be location specific b) they tend to rely on internal resources c) they generate minimal or zero environmental externalities and d) they incorporate concern for future generations and therefore require a longer time – frame for evaluation. Location specific technology may have limited scope for diffusion. However the science behind the technology can be diffused over large areas, allowing people in different locations to evolve innovative solutions specific to their own socio-ecological conditions. These differences from conventional innovations imply that the nature of policy support needed will also be different. A theory on innovations for SD would be instrumental in a) providing criteria for screening of SD innovations and b) determining the mix of policy activities needed to support them. The literature on theory of innovations has focused mainly on exogenous innovations which rely on exogenous knowledge systems and supply of external resources. In the process innovation theories such as Theory of Induced Innovation etc. have tended to neglect autonomous, endogenous innovation occurring at grassroots level. This study aims at achieving an understanding of heuristics used by grassroot innovators, through study of technological innovations for SD, in the context of agricultural pest management. Institutional and cultural innovations will be included only when they are found in association with the technological innovations being studied. The innovators will be studied at three levels a) innovation b) innovator c) early user and/or early discontinuer. A multiple case study method will be adopted. Innovations will be selected on the basis of sustainability criteria. Informal and iterative interview method will be used to develop case studies. The case studies are expected to illuminate the heuristics used by SD innovators as well as the key variables that influence their evolution and use. Key variables include contextual variables (ecological, economic, social) and personal variables (knowledge base, value system). The interrelationship between heuristics and key variables would form the basis of a theory of innovation for SD. A major contribution of this study will be to make possible the discrimination of heuristics for innovation on the basis of sustainability criteria. However the insights gained would help in remodeling not just policy support for innovation, but also in strengthening capabilities of grassroot innovators, voluntary groups and academic activists.

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IIMA