Economic Liberalization and the Vintages of Machinery Imports in Developing Countries: An Empirical Test for India's Imports from the United Kingdom |
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| Authors: | Katsushi S Imai Raghav Gaiha Ganesh Thapa |
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| Institution: | 1. Economics, School of Social Sciences, Arthur Lewis Building, University of Manchester , Oxford Road, Manchester, M13 9PL, UK katsushi.imai@manchester.ac.uk;3. Department of Urban Studies and Planning , MIT , 77 Massachusetts Ave., Room 7–346, Cambridge, MA, 02139, USA;4. Faculty of Management Studies, University of Delhi , 110 007, India;5. Asia and the Pacific Division , International Fund for Agricultural Development (IFAD) , Via Paolo di Dono, 44, 00142, Rome, Italy |
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| Abstract: | Drawing upon new World Bank poverty data, the analysis examines the feasibility of attaining the Millennium Development Goal of halving extreme poverty (MDG1) when the interrelationships between finance, institutions, trade liberalization, growth and poverty are taken into account. The authors' econometric results suggest a slowing down of poverty reduction in the more recent years since 2000. They also confirm: the role of better institutions in income growth, poverty reduction, trade openness and financial development; the role of financial development in economic growth; and the positive effect of capital liberalization on financial development. Simulations for different regions show that MDG1 is attainable in most regions if the historical growth rate is maintained over 2006–15. However, improvements in institutional quality are crucial for halving extreme poverty in sub-Saharan Africa. |
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