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From “Hindu Growth” to Productivity Surge: The Mystery (2004)
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| Venue: | of the Indian Growth Transition,” IMF Working Paper No. 04/77 (Washington: International Monetary Fund |
| Citations: | 112 - 11 self |
BibTeX
@INPROCEEDINGS{Rodrik04from“hindu,
author = {Prepared Dani Rodrik and Arvind Subramanian},
title = {From “Hindu Growth” to Productivity Surge: The Mystery},
booktitle = {of the Indian Growth Transition,” IMF Working Paper No. 04/77 (Washington: International Monetary Fund},
year = {2004}
}
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Abstract
This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. This paper explores the causes of India’s productivity surge around 1980, more than a decade before serious economic reforms were initiated. Trade liberalization, expansionary demand, a favorable external environment, or improved agricultural performance did not play a role. We find evidence that the trigger may have been an attitudinal shift by the government in the early 1980s, which, unlike the reforms of the 1990s, was pro-business rather than pro-market in character, favoring the interests of existing business rather than new entrants or consumers. A relatively small shift elicited a large productivity response because India was far away from its income possibility frontier. Registered manufacturing, which had been built up in previous decades, played an important role in determining which states took advantage of the changed environment.
Keyphrases
productivity surge hindu growth working paper important role attitudinal shift trade liberalization india productivity surge large productivity response previous decade expansionary demand income possibility frontier improved agricultural performance registered manufacturing imf policy serious economic reform new entrant small shift paper describe research favorable external environment
