The unequal effects of liberalization: evidence from dismantling the License Raj in India

Aghion, Philippe ORCID: 0000-0002-9019-1677, Burgess, Robin ORCID: 0009-0002-1187-3248, Redding, Stephen and Zilibotti, Fabrizio (2006) The unequal effects of liberalization: evidence from dismantling the License Raj in India. . London School of Economics and Political Science. Centre for Economic Performance, London, UK.

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Abstract

This paper investigates whether the effects, on registered manufacturing out-put, employment, entry and investment, of dismantling the ‘license raj’ - a system of central controls regulating entry and production activity in this sector - vary across Indian states with different labor market regulations. The effects are found to be unequal depending on the institutional environment in which industries are embedded. In particular, following delicensing, industries located in states with pro-employer labor market institutions grew more quickly than those in pro-worker environments. Our results emphasize how local institutions matter for whether industry in a region benefits or is harmed by the nationwide delicensing reform.

Item Type:	Monograph (Discussion Paper)
Official URL:	http://cep.lse.ac.uk/
Additional Information:	© 2006 the authors
Divisions:	Centre for Economic Performance STICERD Economics
Subjects:	H Social Sciences > HD Industries. Land use. Labor
JEL classification:	O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O18 - Regional, Urban, and Rural Analyses O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O14 - Industrialization; Manufacturing and Service Industries; Choice of Technology O - Economic Development, Technological Change, and Growth > O2 - Development Planning and Policy > O21 - Planning Models; Planning Policy
Date Deposited:	10 Mar 2008 11:34
Last Modified:	11 Dec 2024 18:46
URI:	http://eprints.lse.ac.uk/id/eprint/3773

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