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Industrial location in post-reform India: patterns of inter-regional divergence and intra-regional convergence

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  • Sanjoy Chakravorty

Abstract

Where do new industrial investments locate, and what factors drive the industrial location decisions? Do these investments follow the model of 'divergence followed by convergence' suggested by the cumulative causation, agglomeration economies, and transport-costs approaches? These questions are examined with district-level data from India for the pre- and post-reform periods using: first, tables and maps of concentration and clustering, aggregated for all industry and disaggregated into five sectors (Heavy Industries, Chemicals and Petroleum, Textiles, Agribusiness, and Utilities), and second, logistic and OLS/Heckman selection regression models for these six elements. The data provide solid evidence both of inter-regional divergence and intra-regional convergence, and suggest that 'concentrated decentralisation' is the appropriate framework for understanding industrial location in post-reform India.

Suggested Citation

  • Sanjoy Chakravorty, 2003. "Industrial location in post-reform India: patterns of inter-regional divergence and intra-regional convergence," Journal of Development Studies, Taylor & Francis Journals, vol. 40(2), pages 120-152.
  • Handle: RePEc:taf:jdevst:v:40:y:2003:i:2:p:120-152 DOI: 10.1080/00220380412331293797
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    Cited by:

    1. Saikia, Dilip, 2011. "Unorganised Manufacturing Industries in India – A Regional Perspective," MPRA Paper 64198, University Library of Munich, Germany.
    2. Esther Duflo & Michael Greenstone & Nicholas Ryan, 2013. "Truth-telling by Third-party Auditors and the Response of Polluting Firms: Experimental Evidence from India," The Quarterly Journal of Economics, Oxford University Press, vol. 128(4), pages 1499-1545.
    3. Sharma, Ajay & Chandrasekhar, S., 2014. "Growth of the Urban Shadow, Spatial Distribution of Economic Activities, and Commuting by Workers in Rural and Urban India," World Development, Elsevier, vol. 61(C), pages 154-166.
    4. Sabyasachi TRIPATHI, 2014. "Estimating Urban Agglomeration Economies for India: A New Economic Geography Perspective," Theoretical and Empirical Researches in Urban Management, Research Centre in Public Administration and Public Services, Bucharest, Romania, vol. 9(2), pages 5-34, May.
    5. repec:hrs:journl:v:ix:y:2017:i:2:p:131-146 is not listed on IDEAS
    6. Peter Nunnenkamp & Rudi Stracke, 2008. "Foreign Direct Investment In Post-Reform India: Likely To Work Wonders For Regional Development?," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 33(2), pages 55-84, December.
    7. repec:rom:terumm:v:12:y:2017:i:3:p:45-62 is not listed on IDEAS
    8. Saikia, Dilip, 2009. "Industrial Location in India under Liberalization," MPRA Paper 27821, University Library of Munich, Germany.
    9. Tripathi, Sabyasachi, 2015. "Do upcoming “Smart cities” need to provide smart distribution of higher urban economic growth? Evidence from Urban India," MPRA Paper 61527, University Library of Munich, Germany.
    10. Megha Mukim & Peter Nunnenkamp, 2012. "The Location Choices of Foreign Investors: A District-level Analysis in India," The World Economy, Wiley Blackwell, vol. 35(7), pages 886-918, July.
    11. Mallik, Chinmoyee, 2009. "Urbanisation and the Peripheries of Large Cities in India: The Dynamics of Land Use and Rural Work," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 64(3).
    12. Saikia, Dilip, 2011. "Does Economic Integration Affect Spatial Concentration of Industries? Theory and a Case Study for India," MPRA Paper 64199, University Library of Munich, Germany.
    13. Tripathi, Sabyasachi & Kumar, Shamika, 2016. "Determinants of firm location choice in metropolitan cities in India: A binary Logit model analysis," MPRA Paper 73995, University Library of Munich, Germany.
    14. Dirk Holtbrügge & Carina B. Friedmann, 2016. "Does location choice affect foreign subsidiary success in India? An empirical study based on Porter's diamond model," International Journal of Business and Emerging Markets, Inderscience Enterprises Ltd, vol. 8(1), pages 3-29.

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