Price and Income Elasticity of Indian Exports—The Role of Supply-Side Bottlenecks

Author/Editor:

Mehdi Raissi ; Volodymyr Tulin

Publication Date:

July 17, 2015

Electronic Access:

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Summary:

This paper estimates the short-term and long-run price and income elasticity of Indian exports, and investigates the role of supply-side bottlenecks in shaping India’s export demand relationship. We use disaggregated export volume data for 45 Indian industries over the period 1990-2013, as well as industry-specific international relative prices, for estimation. Our results indicate that Indian exports are sensitive to international relative-price competitiveness, world demand, and energy shortages. In addition, binding supply-side constraints (notably energy shortages) dampen price responsiveness in the short-term.

Series:

Working Paper No. 2015/161

Subject:

Export performance Export prices Exports International trade National accounts Personal income Price elasticity Prices

English

Publication Date:

July 17, 2015

ISBN/ISSN:

9781513544816/1018-5941

Stock No:

WPIEA2015161

Pages:

16

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