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Structural Change and Service-led Growth in India

Author

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  • Philippe Aghion

    (LSE)

  • Fabrizio Zilibotti

    (Yale Univerity)

  • Michael Peters

    (Yale University)

  • Robin Burgess

Abstract

In the last 30 years, India grew substantially, agricultural employment declined markedly, manufacturing employment did not change much but consumer service employment increased rapidly. In the cross-section of Indian districts we also a find a strong correlation between income per capita and the employment share in consumer services. We use micro data on expenditures shares, regional data on employment shares and income per capita and a spatial model of structural change to infer the underlying reasons for these patterns. Our exercise implies that productivity growth in consumer services account for .... % of aggregate productivity growth in India. We also show that differences in consumer service growth across Indian districts account for ...\% of the observed change in spatial inequality.

Suggested Citation

  • Philippe Aghion & Fabrizio Zilibotti & Michael Peters & Robin Burgess, 2019. "Structural Change and Service-led Growth in India," 2019 Meeting Papers 393, Society for Economic Dynamics.
    • Handle: RePEc:red:sed019:393
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    Cited by:

    1. Varela, Liliana & Saffie, Felipe & Yi, Kei-Mu, 2020. "The Micro and Macro Dynamics of Capital Flows," CEPR Discussion Papers 14893, C.E.P.R. Discussion Papers.

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