The Unequal Effects of Liberalization: Evidence from Dismantling the License Raj in India

Philippe Aghion, Robin Burgess, Stephen Redding and Fabrizio Zilibotti

CEP Discussion Papers from Centre for Economic Performance, LSE

Abstract: This paper investigates whether the effects, on registered manufacturing out- put, employment, entry and investment, of dismantling the .license raja 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 de-licensing, 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.

Keywords: delicensing; economic development; labour regulation (search for similar items in EconPapers)
JEL-codes: O14 O18 O21 (search for similar items in EconPapers)
Date: 2006-06
New Economics Papers: this item is included in nep-com, nep-cwa, nep-dev, nep-lab and nep-reg
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Citations: View citations in EconPapers (43)

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https://cep.lse.ac.uk/pubs/download/dp0728.pdf (application/pdf)

Related works:
Journal Article: The Unequal Effects of Liberalization: Evidence from Dismantling the License Raj in India (2008)
Working Paper: The Unequal Effects of Liberalization: Evidence from Dismantling the License Raj in India (2008)
Working Paper: The Unequal Effects of Liberalization: Evidence from Dismantling the License Raj in India (2007)
Working Paper: The Unequal Effects of Liberalization: Evidence from Dismantling the License Raj in India (2006)
Working Paper: The unequal effects of liberalization: evidence from dismantling the License Raj in India (2006)
Working Paper: The Unequal Effects of Liberalization: Evidence from Dismantling the License Raj in India (2006)
Working Paper: The Unequal Effects of Liberalization: Evidence fromDismantling the License Raj in India (2005)
Working Paper: The unequal effects of liberalization: evidence from dismantling the license Raj in India (2005)
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