The misallocation of land and other factors of production in India

Gilles Duranton, Syed Ejaz Ghani, Arti Goswami Grover, William Robert Kerr, Gilles Duranton, Syed Ejaz Ghani, Arti Grover Goswami and William Robert Kerr
Authors registered in the RePEc Author Service: Arti Grover, William Kerr, SYED Ejaz Ghani () and Gilles Duranton

No 7221, Policy Research Working Paper Series from The World Bank

Abstract: This paper quantifies the misallocation of manufacturing output and factors of production between establishments across Indian districts during 1989-2010. It first distills a number of stylized facts about misallocation in India, and demonstrates the validity of misallocation metrics by connecting them to regulatory changes in India that affected real property. With this background, the study next quantifies the implications and determinants of factor and output misallocation. Although more-productive establishments in India tend to produce more output, factors of production are grossly misallocated. A better allocation of output and factors of production is associated with greater output per worker. Misallocation of land plays a particularly important role in these challenges.

Keywords: Pulp&Paper Industry; Textiles; Apparel&Leather Industry; General Manufacturing; Food&Beverage Industry; Common Carriers Industry; Construction Industry; Business Cycles and Stabilization Policies; Plastics&Rubber Industry; Energy and Mining; Energy Demand; Energy and Environment; Industrial Economics; Economic Growth; Economic Theory&Research; Labor Markets; Transport Services (search for similar items in EconPapers)
Date: 2015-03-23
New Economics Papers: this item is included in nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)

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