Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/89957
Year of Publication: 
2014
Series/Report no.: 
IZA Discussion Papers No. 7885
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
Business groups, which are ubiquitous in emerging market economies, balance the advantages of characteristics such as internal capital markets with the disadvantages such as inefficient internal distribution of resources and suppression of technological and other forms of innovativeness. In this paper, we examine, in the Indian context, whether business group affiliation provides an advantage over unaffiliated (or private independent) firms with respect to technological progress, which lies at the heart of wider economic growth and prosperity. Our results suggest that while business group affiliation did provide an advantage over private independent firms at the start of the sample period (2000), this advantage was more than offset by the turn of the century. We discuss the implications of our results for economic growth rates in emerging market economies.
Subjects: 
business groups
technological progress
India
JEL: 
D24
L21
L22
O12
Document Type: 
Working Paper

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