Identifying the Aggregate Productivity Effects of Entry and Size Restrictions: An Empirical Analysis of License Reform in India

Amalavoyal Chari

American Economic Journal: Economic Policy, 2011, vol. 3, issue 2, 66-96

Abstract: Distortions in the allocation of resources between heterogeneous producers have the potential to generate large reductions in aggregate productivity, a point that has been stressed by recent studies. There is, however, little direct empirical evidence from actual policy experiments on the magnitude of these effects. This paper proposes a simple methodology that empirically identifies the separate effects of entry and size restrictions on aggregate productivity, and uses it to analyse the impact of a policy reform in India. (JEL L11, L24, O14, O47)

JEL-codes: L11 L24 O14 O47 (search for similar items in EconPapers)
Date: 2011
Note: DOI: 10.1257/pol.3.2.66
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Citations: View citations in EconPapers (35)

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