Publication:
Firm-Level Input Distortion in Indian States

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dc.contributor.authorChaurey, Ritam
dc.contributor.authorManghnani, Ruchita
dc.contributor.authorPerego, Viviana M. E.
dc.contributor.authorSharma, Siddharth
dc.date.accessioned2022-05-18T17:38:04Z
dc.date.available2022-05-18T17:38:04Z
dc.date.issued2022-05-17
dc.description.abstractThis paper measures trends in factor misallocation in India between 1999 and 2014, using data from a rich panel of Indian firms. The misallocation of a factor is modeled as an adjustment cost, that is, an implicit variable cost incurred by a firm when using that factor. Trends in the adjustment cost are estimated using a new adaptation of the firm-level cost-minimization approach. The paper documents these trends for four factors of production (permanent labor, contract labor, land, and fixed capital) across Indian states and by firm size. Overall, the findings show that adjustment costs declined over time for labor and land but with significant heterogeneity with respect to state growth rate and firm size. Using these stylized facts on trends in factor adjustment costs, as well as in-depth field interviews with firms in two Indian states, the paper also discusses potential policy developments behind these trends, including a preliminary examination of the role of state-level governance in the implementation of relevant factor market policies.en
dc.identifierhttp://documents.worldbank.org/curated/en/099535305172211094/IDU03a5833790e14d04be0084b301c940b591efe
dc.identifier.doi10.1596/1813-9450-10048
dc.identifier.urihttps://hdl.handle.net/10986/37451
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Papers;10048
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectMISALLOCATION
dc.subjectFIRMS
dc.subjectDISTORTIONS
dc.subjectLAND MARKET
dc.subjectLABOR MARKET
dc.subjectFACTOR MISALLOCATION
dc.subjectFIRM PERFORMANCE
dc.subjectCOMPETITIVENESS
dc.subjectPRODUCTIVITY
dc.subjectREALLOCATION OF RESOURCES
dc.subjectRESOURCE ALLOCATION
dc.subjectNATIONAL LABOR POLICY
dc.subjectMANUFACTURING
dc.subjectLAND USE
dc.titleFirm-Level Input Distortion in Indian Statesen
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.date.disclosure2022-05-17
okr.date.lastmodified2022-05-17T00:00:00Zen
okr.doctypePolicy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/099535305172211094/IDU03a5833790e14d04be0084b301c940b591efe
okr.guid099535305172211094
okr.identifier.doi10.1596/1813-9450-10048
okr.identifier.externaldocumentum33820427
okr.identifier.internaldocumentum33820427
okr.identifier.reportWPS10048
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099535305172211094/pdf/IDU03a5833790e14d04be0084b301c940b591efe.pdfen
okr.region.countryIndia
okr.topicCommunities and Human Settlements::Land Use and Policies
okr.topicPrivate Sector Development::Corporate Data and Reporting
okr.topicPrivate Sector Development::Corporate Governance
okr.topicRural Development::Rural Labor Markets
okr.topicSocial Protections and Labor::Labor Markets
okr.unitOffice of the Chief Economist (SARCE)
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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