Rajesh Panda ¹, Madhvi Sethi ¹, Srijani Chaudhuri ¹

Affiliations
1 Symbiosis Institute of Business Management, Symbiosis International University, Bengaluru - 560100, Karnataka, IN

Abstract

Objectives: The objectives of the study were to understand the evolution of trade theories and their application across nations over a period of time and to provide future direction of research for international trade. Methods/Statistical Analysis: To meet the objectives, the study undertook a comprehensive review of literature to bring together works of different researchers in the area of international trade. It summarizes the past theories and applications with the research advancements over the years. Findings: The study finds that over the years, research in international trade has evolved with new forms of models coming into existence. Many trade theories like absolute advantage, comparative advantage, factor endowment, factor price equalization, gravity model etc. have emerged and applied. At the same time, the trade environment across the developed and developing countries has metamorphosed with the advent of World Trade Organization and multiple trade blocs. Several factors have significantly gained importance, thus leading to a need of new dimensions in trade research. Conclusion/Improvements: The study proposes development of trade models which could incorporate pace of technological development and innovation, economic shocks like financial crisis, Brexit etc. and changes in global value chains. It also highlights the importance of future research in trade in services.

Keywords

Gravity Model, International Trade, Trade Models, Trade Theories.

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Dipali Krishnakumar ¹, Madhvi Sethi ²

Affiliations
1 Symbiosis Centre for Management and Human Resource Development, Symbiosis International University, Hinjewadi, Pune - 110057, Maharashtra, IN
2 Symbiosis Institute of Business Management, Bangalore, Symbiosis International University, Bengaluru - 560 100, Karnataka, IN

Abstract

Background/Objectives: This paper examines three years post initial public offering (IPO) corporate strategies of Indian firms to understand whether firm characteristics impact post IPO growth strategies of firms. Method/Analysis: A sample of firms that completed Initial Public offerings during the period 2001 to 2011 and data on mergers and acquisitions during the period 2000 to 2014 has been extracted from the Bloomberg data base. This data set is combined with firm level financials data from CMIE prowess. Two logistic models, one where the outcome is making an acquisition and the other where the outcome is becoming a target, have been used to identify characteristics of firms that make acquisitions or become targets of acquisitions within three years of an IPO. Findings: The main finding of the study is that there is a higher probability of larger firms undertaking acquisitions post IPO. However, younger firms, with lower promoter holdings and lower profitability are more likely to be targets of acquisitions within three years of an IPO. Applications/Improvements: This study introduces a new theme to the current literature by incorporating IPO and M&A strategies in a more integrated framework by studying empirically the choices – to be an acquirer or to be a target - available to a firm in India.

Keywords

Growth Strategy, Initial Public Offering (IPO), Mergers and Acquisitions

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Rajesh Panda ¹, Madhvi Sethi ¹, M. Kumaran ¹

Affiliations
1 Symbiosis Institute of Business Management, Bengaluru - 560100, Karnataka, IN

Abstract

Background/Objectives: According to the World Trade Organization data for 2013, China became world’s largest trading nation and India became the 15th largest trading nation. Emerging economies gained a lot of momentum in world trade. This study analyses the trade flows of two of the emerging economies namely China and India with an objective to draw a comparison between the determinants of bilateral trade flows of the two nations using data for a period of 9 years (2004- 2013). Methods/Statistical Analysis: To achieve the objective, gravity model has been applied on a panel dataset for the two countries. The data has been collected from International Monetary Fund (IMF), CEPII’s Geodist database and United Nations Conference on Trade and Development (UNCTAD). The study employs random effects panel regression model to establish the relationship between trade flows and different variables including distance, gross domestic product, per capital income, contiguity, common language and common colonizer. It compares the determinants of trade for India with China. Findings: The findings of the empirical analysis are in accordance with past literature indicating that India and China trade flows are mostly with geographically closer countries. Additionally, India’s trade flows are with countries having higher GDP but with lower per capita income. China’s trade is influenced by higher per capita income of the trading partner and common language. When crisis is introduced in the analysis, post crisis, common colony became an important influencer of trade for India. Applications/Improvements: This study helps in identifying the key determinants of India and China’s trade flows. It also provides a pre and post crisis analysis of the trade partnerships which might have future implications for trade policy and trade relations for the two countries.

Keywords

Bilateral Trade, China, Gravity Model, India

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