NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

India Transformed? Insights from the Firm Level 1988-2005

Laura Alfaro, Anusha Chari

NBER Working Paper No. 15448
Issued in October 2009
NBER Program(s):   CF   IFM   ITI   POL   EFG

Using firm-level data this paper analyzes the transformation of India’s economic structure following the implementation of economic reforms. The focus of the study is on publicly-listed and unlisted firms in manufacturing and services industries. Detailed balance sheet and ownership information permit an investigation of a range of variables. We analyze firm characteristics shown by industry before and after liberalization and investigate how industrial concentration, number, and size of firms evolved between 1988 and 2005. We find great dynamism displayed by foreign and private firms as reflected in the growth in their numbers, assets, sales and profits. Yet, closer scrutiny reveals no dramatic transformation in the wake of liberalization. The story rather is one of an economy still dominated by the incumbents (state-owned firms) and to a lesser extent, traditional private firms (firms incorporated before 1985). Sectors dominated by state-owned and traditional private firms before 1988-1990, with assets, sales and profits representing shares higher than 50%, generally remained so in 2005. The exception to this broad pattern is the growing importance of new private firms in the services sector. Rates of return also have remained stable over time and show low dispersion across sectors and across ownership groups within sectors.

download in pdf format
   (287 K)

email paper

This paper is available as PDF (287 K) or via email.

Acknowledgments

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w15448

Published: Alfaro, Laura, and Anusha Chari. "India Transformed: Insights from the Firm Level 1988–2005." India Policy Forum 6 (2009).

Users who downloaded this paper also downloaded these:
Bosworth, Collins, and Virmani w12901 Sources of Growth in the Indian Economy
Kochhar, Kumar, Rajan, and Subramanian w12023 India's Patterns of Development: What Happened, What Follows
Bosworth and Collins w12943 Accounting for Growth: Comparing China and India
Topalova w11614 Trade Liberalization, Poverty, and Inequality: Evidence from Indian Districts
Eichengreen and Gupta w16757 The Service Sector as India's Road to Economic Growth
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us