This paper studies the impact of input-trade liberalization on firms' decision to upgrade foreign technology embodied in imported capital goods. The empirical analysis is motivated by a simple theoretical framework of endogenous technology adoption, heterogeneous firms and imported inputs. The...

Are financial constraints preventing firms from importing capital goods? Sourcing capital goods from foreign countries is costly and requires internal or external financial resources. A simple model of foreign technology adoption shows that credit constraints act as a barrier to importing...

Foreign technology transfers play a key role in economic growth. This paper investigates the effects of input-trade liberalization on firms’ decision to upgrade foreign technology embodied in imported capital goods. We develop a theoretical model of endogenous technology adoption,...

Are financial constraints preventing firms from importing capital goods? Sourcing capital goods from foreign countries is costly and requires internal or external financial resources. A simple model of foreign technology adoption shows that credit constraints act as a barrier to importing...

The analysis of structural reforms that took place in the 1990s in India reveals interesting insights in the context of the actual debate for further liberalization of the services sector. Trade liberalization and the reform of the banking sector have improved aggregate productivity of the...

This paper investigates the microeconomic effects of financial development on economic growth. The increased availability of credit is usually expected to improve firms’ growth due to the elimination of credit constraints. We investigate this question using a survey of Indian firms in the...