Seker, Murat2012-03-192012-03-192011-11-01https://hdl.handle.net/10986/3643The regulatory environment in a country can affect firm performance. This study investigates the impact of a particular regulation, namely license requirements for certain firm activities, on the innovation performance of Indian firms. First it presents a model of firm and industry evolution that explains the dynamics of multi-product firms. Then, using a firm level panel data set, it shows that removal of license requirements led to roughly 5 percentage points faster innovation rates where innovation is measured as introduction of new product varieties that had not existed in the market. The results are robust to inclusion of controls for the other policy reforms that occurred during the period of licensing reform.CC BY 3.0 IGOACCESS TO TECHNOLOGYBALANCE SHEETSCOMMODITYCOMPETITION POLICYCOMPETITIVE PRODUCTCOMPETITIVENESSDATA COVERAGEDEMOCRACYDEVELOPMENT ECONOMICSDISCUSSIONDISCUSSIONSE-MAILECONOMIC ACTIVITYECONOMIC COOPERATIONECONOMIC POLICIESECONOMICSEMPLOYMENTEXPANSIONEXPECTED PRESENT VALUEEXPENDITUREEXPENDITURESFIRM SIZEFIRMSFOREIGN DIRECT INVESTMENTFOREIGN INVESTMENTFOREIGN TRADEGLOBAL ECONOMYGOVERNMENT RESTRICTIONSHUMAN CAPITALIDEAIDEASINCOMEINDUSTRIAL RELATIONSINDUSTRY PRODUCTIVITYINNOVATIONINNOVATION STRATEGIESINNOVATION STRATEGYINPUT FACTORINTERMEDIATE GOODSINTERNATIONAL TRADEJOB CREATIONJOB FLOWSKNOWLEDGE CAPITALLABOR REGULATIONSLEADINGLICENSELICENSESLICENSINGMANUFACTURINGMARKET COMPETITIONMARKET CONDITIONSMARKET DISCIPLINEMARKET REFORMSMOTIVATIONNEW TECHNOLOGYOPEN ACCESSPARENT COMPANYPDFPERFORMANCESPOLITICAL ECONOMYPRICE INDEXPRIVATE SECTORPRIVATE SECTOR DEVELOPMENTPRODUCT INFORMATIONPRODUCT INNOVATIONPRODUCT MARKETPRODUCT MARKETSPRODUCT QUALITYPRODUCTION PROCESSESPRODUCTIVITIESPRODUCTIVITYPRODUCTIVITY GROWTHR&DREGULATORY ENVIRONMENTRESULTRESULTSSALESKILLED WORKERSSMALL FIRMSSUBSTITUTIONTECHNOLOGICAL INNOVATIONTECHNOLOGY DIFFUSIONTECHNOLOGY TRANSFERTIME PERIODTIME PERIODSTOTAL SALESTRADE LIBERALIZATIONTRADE REFORMSTRANSACTIONTRANSACTIONS COSTSTURNOVERUSERSUSESVARIETYWEBWorld Bank10.1596/1813-9450-5876