TDPE presents: Asha Sundaram

Asha Sundaram, University of Cape Town, South Africa

Trade Liberalization and Firm Sales Volatility: Evidence from India

The author looks at the impact of trade liberalization on product-level sales volatility of firms. Exploiting India’s externally imposed trade reform to identify trade liberalization effects, she finds that while a fall in the tariff on the final product produced by the firm is associated with an increase in volatility in Indian manufacturing firms, a fall in the tariff on intermediate inputs is associated with a decrease in volatility, with the latter effect dominating the former. She hence proposes an additional channel for gains from trade liberalization, relevant particularly for developing countries with weaker mechanisms in place to deal with volatility.

Asha Sundaram is a Senior Lecturer (Assistant Professor) at The School of Economics, Faculty of Commerce, University of Cape Town.  Her research interests are in the fields of International Trade and Development Economics.  Topics she works on include trade liberalization effects and their interaction with domestic institutions, trade and firm behavior, buyer-seller matches in international trade, immigration and micro enterprises and the informal sector. She holds an M.Phil. in Economics from Oxford University and a PhD in Economics from Syracuse University.

Sponsored by the Trade Development and Political Economy Program at the Moynihan Institute of Global Affairs