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What Holds Back Bangalore Businesses?


  • Amar Bhid

    (Columbia Business School, 3022 Broadway, Uris Hall 722, New York, NY 10027,)


This paper focuses on non-Information Technology businesses operating in the city of Bangalore, India. Data on firms compiled from statutory regulatory filings suggest that the number and proportion of businesses that expand rapidly are much lower than in the United States. In-depth interviews with over 100 entrepreneurs in Bangalore suggest that deficiencies in the performance of basic governmental functions (such as in collecting taxes and maintaining land records) play a significant role in discouraging businesses from starting at or expanding to an economically efficient scale of operation. (c) 2008 The Earth Institute at Columbia University and the Massachusetts Institute of Technology.

Suggested Citation

  • Amar Bhid, 2008. "What Holds Back Bangalore Businesses?," Asian Economic Papers, MIT Press, vol. 7(1), pages 120-153, Winter.
  • Handle: RePEc:tpr:asiaec:v:7:y:2008:i:1:p:120-153

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    References listed on IDEAS

    1. Ranciere, Romain & Tornell, Aaron & Westermann, Frank, 2006. "Decomposing the effects of financial liberalization: Crises vs. growth," Journal of Banking & Finance, Elsevier, vol. 30(12), pages 3331-3348, December.
    2. Carmen M. Reinhart & Graciela L. Kaminsky, 1999. "The Twin Crises: The Causes of Banking and Balance-of-Payments Problems," American Economic Review, American Economic Association, vol. 89(3), pages 473-500, June.
    3. Peter Blair Henry, 2007. "Capital Account Liberalization: Theory, Evidence, and Speculation," Journal of Economic Literature, American Economic Association, vol. 45(4), pages 887-935, December.
    4. Bekaert, Geert & Harvey, Campbell R. & Lundblad, Christian, 2005. "Does financial liberalization spur growth?," Journal of Financial Economics, Elsevier, vol. 77(1), pages 3-55, July.
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