REFORMS AND INVESTMENT IN INDIA

Prema-chandra Athukorala and Kunal Sen

Departmental Working Papers from The Australian National University, Arndt-Corden Department of Economics

Abstract: This paper examines the determinants of private corporate investment in India with emphasis on the implications of the policy reforms initiated in 1991. The results suggest that the net impact of the reforms on corporate investment has been salutary. The adverse impact of the decline in public investment has been outweighed by the positive effects of the decline in the cost of capital and favourable changes in investor perception brought about by the reforms. While it is not possible to generalise from a single country case, our results cast doubt on the existing cross-country evidence of a negative impact of structural adjustment reforms on private investment.

JEL-codes: E22 O11 O16 (search for similar items in EconPapers)
Date: 1996-08
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Citations: View citations in EconPapers (1)

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Working Paper: Reforms and Investment in India (1996)
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Persistent link: https://EconPapers.repec.org/RePEc:pas:papers:1996-06

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