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Where have all the factories gone?: Growth and concentration of sub-national manufacturing activity in India

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  • K.V. Ramaswamy

    (Indira Gandhi Institute of Development Research)

Abstract

The spatial distribution of manufacturing across the states of India is analyzed covering the period 2004-05 to 2015-16. We found that the spatial concentration of manufacturing activity has increased since 2004-05. More industrialized states (example Maharashtra, Gujarat and Tamil Nadu) are found to have continued their dominance measured in terms of their share of output, factories and workers in manufacturing. They are observed to have captured a greater share of incremental growth of factories and workers. This outcome may be attributed to their comparative advantage due to agglomeration economies. Differences in the net entry of factories (and workers) in registered and unregistered segments of manufacturing are observed between different states of India. The estimates of net entry of factories in five selected industry groups in registered manufacturing are found to be consistent with agglomeration at the sectoral level.

Suggested Citation

  • K.V. Ramaswamy, 2019. "Where have all the factories gone?: Growth and concentration of sub-national manufacturing activity in India," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2019-015, Indira Gandhi Institute of Development Research, Mumbai, India.
    • Handle: RePEc:ind:igiwpp:2019-015
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    References listed on IDEAS

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    1. Somik Vinay Lall & Sanjoy Chakravorty, 2005. "Industrial Location and Spatial Inequality: Theory and Evidence from India," Review of Development Economics, Wiley Blackwell, vol. 9(1), pages 47-68, February.
    2. Kanbur, Ravi & Venables, Anthony J. (ed.), 2005. "Spatial Inequality and Development," OUP Catalogue, Oxford University Press, number 9780199278633, Decembrie.
    3. Kanbur, Ravi & Venables, Anthony J., 2005. "SPATIAL INEQUALITY AND DEVELOPMENT Overview of UNU-WIDER Project," Working Papers 127127, Cornell University, Department of Applied Economics and Management.
    4. Ravi Kanbur & Tony Venables, 2005. "Introduction: Spatial inequality and development," Journal of Economic Geography, Oxford University Press, vol. 5(1), pages 1-2, January.
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    Cited by:

    1. Renjith Ramachandran & Ketan Reddy & Subash Sasidharan, 2020. "Agglomeration and Productivity: Evidence from Indian Manufactuaring," Studies in Microeconomics, , vol. 8(1), pages 75-94, June.

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    More about this item

    Keywords

    Agglomeration; Concentration; Inequality; Spatial; Manufacturing; Net Entry;
    All these keywords.

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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