Distortions in the allocation of resources between heterogeneous producers have the potential to generate large reductions in aggregate
productivity, a point that has been stressed by recent studies. There
is, however, little direct empirical evidence from actual policy experiments
on the magnitude of these effects. This paper proposes a simple methodology that empirically identifies the separate effects of entry and size restrictions on aggregate productivity, and uses it to analyse the impact of a policy reform in India. (JEL L11, L24, O14, O47)
Chari, A V.
"Identifying the Aggregate Productivity Effects of Entry and Size Restrictions: An Empirical Analysis of License Reform in India."
American Economic Journal: Economic Policy,
Production, Pricing, and Market Structure; Size Distribution of Firms
Contracting Out; Joint Ventures; Technology Licensing
Industrialization; Manufacturing and Service Industries; Choice of Technology
Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence