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Economic Geography of Industrial Location: Evidence from Indian States

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  • Ghosh, Saibal

Abstract

Using state-industry data for 1981-98, the paper examines the Rajan-Zingales (1998) hypothesis at the country level. In particular, we examine whether industrial characteristics influence state-level industrial growth. The findings suggest that industries with higher fixed capital and bigger factory sizes tend to grow slower in states with lower penetration of banking. More importantly, the findings testify that financial development of states tends to overwhelm their financial structure in influencing industrial growth.

Suggested Citation

  • Ghosh, Saibal, 2007. "Economic Geography of Industrial Location: Evidence from Indian States," MPRA Paper 22441, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:22441
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    File URL: https://mpra.ub.uni-muenchen.de/22441/1/MPRA_paper_22441.pdf
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    References listed on IDEAS

    as
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    4. Rajan, Raghuram G & Zingales, Luigi, 1998. "Financial Dependence and Growth," American Economic Review, American Economic Association, vol. 88(3), pages 559-586, June.
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    6. Pattnayak, Sanja S. & Thangavelu, S.M., 2005. "Economic reform and productivity growth in Indian manufacturing industries: an interaction of technical change and scale economies," Economic Modelling, Elsevier, vol. 22(4), pages 601-615, July.
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    8. Levine, Ross, 2002. "Bank-Based or Market-Based Financial Systems: Which Is Better?," Journal of Financial Intermediation, Elsevier, vol. 11(4), pages 398-428, October.
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    12. Rana Hasan & Devashish Mitra & K.V. Ramaswamy, 2007. "Trade Reforms, Labor Regulations, and Labor-Demand Elasticities: Empirical Evidence from India," The Review of Economics and Statistics, MIT Press, vol. 89(3), pages 466-481, August.
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    15. Nirvikar Singh & Laveesh Bhandari & Aoyu Chen & Aarti Khare, 2004. "Regional Inequality in India: A Fresh Look," Development and Comp Systems 0412006, EconWPA.
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    More about this item

    Keywords

    financial development; economic growth; states; India;

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • P52 - Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies

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