Doesn't this come close to textbook discussions on perfect competition? Also, relate this to the long-term decision making problem of a firm when it does not have perfect foresight. Do you think Kwid will be able to recover its fixed costs of Rs.3000 crore on a new plant with its aggressive pricing strategy?
http://www.thehindubusinessline.com/companies/renault-launches-small-car-kwid-at-rs-26-lakh/article7684827.ece
Friday, September 25, 2015
Here's some more food for thought ....
Will these strategies work? Are legislative reforms sufficient to ignite growth? And what about employment?
http://www.newindianexpress.com/editorials/Onus-on-Both-Govt-India-Inc/2015/09/25/article3046432.ece
http://www.thehindubusinessline.com/companies/bilt-pulls-out-of-malaysia-sells-stake-in-sabah-forest-for-500-million/article7686130.ece
http://www.thehindubusinessline.com/opinion/editorial/chinks-in-make-in-india/article7686002.ece
http://www.newindianexpress.com/editorials/Onus-on-Both-Govt-India-Inc/2015/09/25/article3046432.ece
http://www.thehindubusinessline.com/companies/bilt-pulls-out-of-malaysia-sells-stake-in-sabah-forest-for-500-million/article7686130.ece
http://www.thehindubusinessline.com/opinion/editorial/chinks-in-make-in-india/article7686002.ece
Aggregate demand, corporate debt and deleveraging
Here are a couple of articles which indicate the consequences of a slack in aggregate demand on corporate debt and the growing need for companies to deleverage debt through asset sales. We can notice this trend not just in India but also in China.
http://www.livemint.com/Companies/JBn41JpbNPdPBxzOb2FzIO/LT-to-sell-assets-dilute-stake-in-noncore-businesses-AM.html
http://www.thehindubusinessline.com/opinion/editorial/taking-a-haircut/article7678161.ece
Does the government need to step in and increase infrastructure spending? Can we hold on to "austerity" and worry about fiscal deficit targets? How do we know that infrastructure projects will not be underutilized (like ghost towns in China)?
These are questions to ponder over.
http://www.livemint.com/Companies/JBn41JpbNPdPBxzOb2FzIO/LT-to-sell-assets-dilute-stake-in-noncore-businesses-AM.html
http://www.thehindubusinessline.com/opinion/editorial/taking-a-haircut/article7678161.ece
Does the government need to step in and increase infrastructure spending? Can we hold on to "austerity" and worry about fiscal deficit targets? How do we know that infrastructure projects will not be underutilized (like ghost towns in China)?
These are questions to ponder over.
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