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The present study is an attempt to analyze the impact of changing policy regime during the liberalization era on the behaviour of 81 sample firms in Indian electronics industry in terms of factor productivities. We categorise a period of 12 years (1993-2004) as the two phases of liberalisation: - Period/ Phase 1: 1993-1998 and Period/ Phase 2: 1999-2004. The 81 sample firms are segregated into four primary sub-sectors of electronics industry based on their use pattern: communication equipments, computer hardware, consumer electronics and other electronics. The objective is to trace the growth of output in the four sub-sectors in Indian electronics industry over two phases of liberalisation and to determine the relative contributions of Input Growth (IG) and Total Factor Productivity Growth (TFPG) to Output Growth (OG). Further, the study focuses on determining the relative contributions of Technological Progress (TP) and Technical Efficiency Change (TEC) to TFPG and establishes the influence of firm specific managerial decision making and management efficiency variables on TEC and TP. The methodology follows a three-step approach in order to achieve the above objectives. The first step is to determine a potential stochastic production function using stochastic frontier production function model and measure firm-wise technical inefficiency levels. The second step is to measure the growth of TFP over two phases and to derive the components TEC and TP. The third step measures the influence of management decision variables on TEC and TP using a frontier approach model on a panel data. The contribution of labour to output was found to be higher than the contribution of capital in all four sub-sectors. However, capital contribution improved in phase 2 relative to phase 1 for computer hardware and other electronics sub-sectors. Computer hardware was the only sub-sector that experienced an improvement in returns to scale from constant returns to scale in phase 1 to increasing returns to scale in phase 2 of liberalisation. The Technological Progress (TP) and Technical Efficiency Change (TEC) that contributed to TFPG exhibited a contrasting relationship for all the four sub-sectors in the electronics industry: TEC declined when there was high TP while it improved when there was a decline in TP. This could be because Indian electronics firms generally focus on either technology imports/ develop indigenous technology to achieve TP or to assimilate the imported/ indigenous technology for better use. The lag in assimilation of imported/ developed technology could be a reason for the negative relation between TEC and TP. The communication equipment sub-sector had a balanced growth in terms of TEC and TP among the four sub-sectors. The computer hardware and the other electronics sub-sectors were worse performers in terms of TEC in period 2 relative to period 1 and so had been the electronics industry as a whole. The computer hardware sub-sector had the highest average OG in period 2 relative to period 1 among all the sub-sectors due to relatively high contribution of IG. Other electronics sub-sector had the highest average TP that compensated for the negative average TEC. On an average, percentage contribution of TP to TFPG was high for the electronics industry and its sub-sectors in period 2 relative to period 1. This is an indication that the sub-sectors of Indian electronics industry have strived and achieved steady technological progress in the period of economic liberalisation to cope with the intensifying competition internally as well as externally. The sample firms in the electronics industry were in favour of towards external acquisition of sophisticated technology, which explains the relatively high contribution of TP to the TFPG of the industry. However, this was not followed up with adequate in-house R&D in order to develop indigenous technology or to absorb imported technology as a result of which TEC for the sub-sectors and the whole industry suffered. Growth in Operating Margin (OMG) and Growth in Returns on Capital Employed (ROCEG) generate additional revenue that could be ploughed back into the firm for improvement of its existing indigenous technology or absorption of imported technology thereby leading to improvement in TE and TP. The positive influence of OMG as well as ROCEG on TEC and TP for all the sub-sectors is an indication of efficient management in these sub-sectors in utilizing assets and profits to generate earnings. However, the trend of operating margin and returns on capital employed had been declining for all the sub-sectors. Inventory management proved to be costly for TP as financial resources diverted to maintain inventory had an undesirable effect on their indigenious technology. Most of the sample firms in the electronics industry were found to have incurred R&D expenditure to derive tax incentives. As a result the resources got diverted away from other creative operational or skill improvement efforts to unproductive and wasteful R&D activities. Thus, R&D did not have the desirable influence on the components of TFPG. The present study showed that unplanned and ad hoc technology imports or even raw material imports was not conducive to the growth of both the components of TFPG. Older firms need to develop their technology or adequately import better and more sophisticated technology. This would enable older (more experienced) electronic firms to overcome the negative influence of age, reflected in our analysis. This is, however, applicable to only those segments of the electronics industry where firms preferred to serve lower end of the market as well as lower end of the technological spectrum (eg. Computer hardware and other electronics sub-sectors). Electronics industry like any other capital goods industry offers scope for vertical integration. Management of the firms in electronics industry should emphasize on vertical integration, expansion of scale of operations and should initiate R&D investments to build up R&D base, among others to improve TEC and TP. This would also help to check the decline in operating margin and returns from invested capital among the firms. Thus, improved managerial effectiveness and decision making do help in the form of generating thereby surpluses facilitating to achieve higher TP and even TEC. Regional and State governments should provide adequate policy support and appropriate industrial infrastructure to electronic firms which would in turn improve their managerial effectiveness and TFPG.

Cette thèse étudie comment le taux de change effectif réel (TCER) et ses mesures associées (volatilité du TCER et désalignement du TCER) affectent la croissance de la productivité totale des facteurs (CPTF). Elle analyse également les canaux par lesquels le TCER et ses mesures associées agissent sur la productivité totale des facteurs (PTF). La première partie étudie comment le TCER lui-Même, d'une part, et la volatilité du TCER, d'autre part, influencent la productivité. Une analyse du lien entre le niveau du TCER et la PTF dans le chapitre 1 indique qu'une appréciation de taux de change cause une augmentation de la PTF. Mais cet impact est également non- inéaire: en-Dessous du seuil, le TCER influence négativement la productivité tandis qu'au-Dessus du seuil il agit positivement. Les résultats du chapitre 2 illustrent que la volatilité du TCER affecte négativement la CPTF. Nous avons également constaté que la volatilité du TCER agit sur PTF selon le niveau du développement financier. Pour les pays modérément financièrement développés, la volatilité du TCER réagit négativement sur la productivité et n'a aucun effet sur la productivité pour les niveaux très bas et très élevés du développement financier. La deuxième partie examine les canaux par lesquels le TCER et ses mesures associées influencent la productivité. Les résultats du chapitre 3 illustrent que la volatilité du TCER a un impact négatif élevé sur l'investissement. Ces résultats sont robustes dans les pays à faible revenu et les pays à revenu moyens, et en employant une mesure alternative de volatilité du TCER. Le chapitre 4 montre que le désalignement du taux de change réel et la volatilité du taux de change réel affectent négativement les exportations. Il démontre également que la volatilité du taux de change réel est plus nocive aux exportations que le désalignement. Ces résultats sont corroborés par des résultats sur des sous-Échantillons de pays à bas revenu et à revenu moyen. / This dissertation investigates how the real effective exchange rate (REER) and its associated asurements (REER volatility and REER misalignment) affect total factor productivity growth (TFPG). It also analyzes the channels through which the REER and its associated measurements act on total factor productivity (TFP). The first part studies how the REER itself, on the one hand, and the REER volatility, on the other hand, influence productivity. An analysis of the link between the level of REER and TFP in chapter 1 reveals that an exchange rate appreciation causes an increase of TFP. But this impact is also nonlinear: below the threshold, real exchange rate influences negatively productivity while above the threshold it acts positively. The results of chapter 2 illustrate that REER volatility affects negatively TFPG. We also found that REER volatility acts on TFP according to the level of financial development. For moderately financially developed countries, REER volatility reacts negatively on productivity and has no effect on productivity for very low and very high levels of financial development. The second part examines the channels through which the REER and its associated measurements influence productivity. The results of chapter 3 illustrate that the exchange rate volatility has a strong negative impact on investment. This outcome is robust in low income and middle income countries, and by using an alternative measurement of exchange rate volatility. Chapter 4 show that both real exchange rate misalignment and real exchange rate volatility affect negatively exports. It also demonstrates that real exchange rate volatility is more harmful to exports than misalignment. These outcomes are corroborated by estimations on subsamples of Low- ncome and Middle-Income countries