Indira Management Review

Kishore G. Kulkarni ¹, Geoff Tennent ²

Affiliations
1 Metropolitan State University of Denver, CB 77, P. O. Box 173362, Denver, CO 80217-3362, US
2 Korbel School of International Studies, University of Denver, 2201 South Gaylord Street,Denver, CO 80209.), US

Abstract

International Trade has long debated as a source of economic growth for countries. Economists such as Adam Smith, David Ricardo, Eli Hecksher and Bertil Ohlin, and others have all put forward ideas and models for how countries benefit from international trade, at times building on their predecessorswork.AdamSmith started with his theory of absolute advantage of production, and countries specializing in the products they could produce at a lower cost. These goods would then be exported in exchange for similarly produced goods. David Ricardo Expanded this model looking instead at the theory of comparative advantage. Hecksher and Ohlin continued this trend looking at factor endowments for beneficial trade. Trade can increase the welfare in all countries, but import tariffs then reduce the welfare gained from trade. There are many reasons for protectionism including undesirable specialization, instability in the export market, terms of trade deterioration, aiding infant industries and others. These theories are applied to the situation in Kuwait and it's policies of protectionism. Kuwait currently allows only Kuwaiti individuals and Kuwaiti majority shareholder firms to import into the country, and there is a 5% ad valorem tax on most nonfood items. In early 2006 there was a modernization of the Kuwaiti customs system resulting in an increased efficiency, which then caused an increase in imports. This is verified in the data obtained from the World Bank. The result being an ease in trade leads toincreased tradeandoverallwelfare.

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Adeoye-Adeyemi Ajibola ¹, Kishore G. Kulkarni ²

Affiliations
1 Korbel School of International Studies, University of Denver, US
2 IJEB, Metropolitan State University of Denver, Denver, CO 80217-3362, US

Abstract

Nigeria is one of many developing economies affected by the "Dutch Disease"- a concept that diagnoses the case of a country so poor yet so rich even with abundant resources. Is it possible to have resource endowment and have a slow growing economy with little or no infrastructural development? In 2009, studies showed that there has been a steady decline in life expectancy and standard of living since the discovery of crude oil in Nigeria in 1956. This is a misnomer as the country has "earned more than US$300 billion from crude oil" (Okonjo-Iweala, 2012, p.4) but corruption, infant mortality, and poor infrastructure has become the bane of the economy impeding any of form of development. In this paper, the concept of Dutch disease as it affects Nigeria is considered with a view to understanding the major culprits in the country's case. It is also surmised that the chief culprit for a nation's poverty is not always the lack of abundant natural resources but lack of planning, preparedness , transparency , mismanagement of these resources and a high level of corruption. It has been concluded that Nigeria as a nation of talented and industrious people would have fared better economically and as a consequence politically, if crude oil had not been discovered and exploited. Some evidence is the gradual decline of GDP, the increase in unemployment rate and the continued increase in the country's poverty level. These should not be the indices of a resource-rich country.

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Shreesh Bhattarai ¹, Kishore G. Kulkarni ²

Affiliations
1 Korbel School of International Studies, University of Denver, US
2 Indian Journal of Economics and Business, Metropolitan State University of Denver, Denver, CO, US

Abstract

This paper, using the Solow growth model looks at the impact of liberalization on India's economic growth. Additionally, using empirical data, it analyzes the patterns, processes, and characteristics of India's economic growth. The Solow model explains the long run economic growth via the change in the Solow residuals. This paper defines the Solow residual as International trade. This paper will show that International trade and fewer regulations on exports and imports have ignited high economic growth in India. After the late 1980s, India saw an immense increase in international trade. Led by low tariff rates, India saw a hike in exports and imports and more importantly, foreign investments. With the backing of facts and figures, this paper will show that India has actually benefited in terms of economic growth from international trade. With liberalization, India has not only had success in the macro level, but it has also impacted people in terms of per capita income in the micro level. This paper is broken down into 4 sections. The first section gives an introduction to India and its relevance to the Solow model. The second section explores the theoretical framework of the Solow model. The third section uses the empirical data to examine the impact of liberalization on India (pre and post reformation). Finally, the fourth section is the analysis and conclusion section which compares India to other South Asian counties and gives policy recommendation.

Keywords

International Trade, Foreign Direct Investment, Exports, Imports.

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