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Threats to property rights: Effects on economic performance of the manufacturing sector in Indian states

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  • Kato, Atsushi
  • Sato, Takahiro

Abstract

We examine the effects of the threats to property rights on the economic performance of the manufacturing sector in Indian states. We constructed indices of the threats using data on crime against property rights. In our analysis, we correct for the problem of underreporting of crimes in official crime data. The results of our instrumental variable estimation show that not only threats to private property but also to contracts adversely affect the performance of the manufacturing sector in India. We also extend our basic model to examine the effects of kidnapping and the scale economies of property rights protection.

Suggested Citation

  • Kato, Atsushi & Sato, Takahiro, 2013. "Threats to property rights: Effects on economic performance of the manufacturing sector in Indian states," Journal of Asian Economics, Elsevier, vol. 26(C), pages 65-81.
    • Handle: RePEc:eee:asieco:v:26:y:2013:i:c:p:65-81
    DOI: 10.1016/j.asieco.2013.02.005
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    More about this item

    Keywords

    Property rights; Contract; Gross value added; TFP;
    All these keywords.

    JEL classification:

    • K00 - Law and Economics - - General - - - General (including Data Sources and Description)
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • P14 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Property Rights
    • P17 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Performance and Prospects

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