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DECTI BBL: Together We Stand? Agglomeration in Indian Manufacturing

SpeakerAna Margarida Fernandes, The World Bank, joint with Gunjan Sharma

Abstract: We use plant-level data from India for the period 1980-99 to examine the impact of industrial  and  trade  policy  reforms  on  the geographic agglomeration of manufacturing industries measured by the  Ellison and Glaeser (1997) index. First, our estimates show that de-licensing and FDI liberalization reduced agglomeration significantly, controlling for standard determinants of agglomeration but trade reforms had no significant effect on agglomeration.  Second, the response of agglomeration to various mechanisms exhibits significant plant size-based differences.  Trade liberalization significantly reduced concentration for large plants, while it had no impact for medium sized and small plants.  De-licensing and FDI deregulation did not affect the spatial concentration of medium sized and large plants but they reduced agglomeration of small plants. 

For Information: Anna Regina Rillo Bonfield

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