Rain, Rain, Go Away? The Investment Climate, State Business Relations and Firm Performance in India
It is commonly argued that a better investment climate reform – that is, lower distortions in the institutional, policy and regulatory environment in which firms operate - lead to discernible improvements in firm performance. In this paper, we argue that effective state business relations condition better investment climate outcomes and that the deeper institutional determinants of firm performance are the former. We examine the effect of effective state-business relations of total factor productivity (TFP) for formal sector firms in India for the years 2000-01 and 2004-05 and find support for this hypothesis.
|Date of creation:||23 Jan 2010|
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- Dethier, Jean-Jacques & Hirn, Maximilian & Straub, Stephane, 2008.
"Explaining Enterprise Performance in Developing Countries with Business Climate Survey Data,"
Policy Research Working Paper Series
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- Kunal Sen & Dirk Te Velde, 2009. "State Business Relations and Economic Growth in Sub-Saharan Africa," Journal of Development Studies, Taylor & Francis Journals, vol. 45(8), pages 1267-1283.
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