American Economic Journal:
Economic Policy
ISSN 1945-7731 (Print) | ISSN 1945-774X (Online)
Identifying the Aggregate Productivity Effects of Entry and Size Restrictions: An Empirical Analysis of License Reform in India
American Economic Journal: Economic Policy
vol. 3,
no. 2, May 2011
(pp. 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)Citation
Chari, A V. 2011. "Identifying the Aggregate Productivity Effects of Entry and Size Restrictions: An Empirical Analysis of License Reform in India." American Economic Journal: Economic Policy, 3 (2): 66–96. DOI: 10.1257/pol.3.2.66Additional Materials
JEL Classification
- L11 Production, Pricing, and Market Structure; Size Distribution of Firms
- L24 Contracting Out; Joint Ventures; Technology Licensing
- O14 Industrialization; Manufacturing and Service Industries; Choice of Technology
- O47 Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
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