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Citation Information

Type Journal Article - American Economic Review
Title The unequal effects of liberalization: Evidence from dismantling the License Raj in India
Author(s)
Volume 94
Issue 4
Publication (Day/Month/Year) 2008
Page numbers 1397-1412
URL http://www.nber.org/papers/w12031.pdf
Abstract
We study the effects of the progressive elimination of the system of industrial regulations on entry and production, known as the "license raj," on registered manufacturing output, employment, entry and investment across Indian states with different labor market regulations. The effects are found to be unequal depending on the institutional environment in which industries are embedded. In particular, following delicensing, industries located in states with pro-employer labor market institutions grew more quickly than those in pro-worker environments.

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