Growth and spread of manufacturing productivity across regions in India

Abstract

An expected outcome of economic reforms in India is enhanced pace of industrialization with manufacturing sector playing a crucial role by increasing its share in output via higher investments and increased productivity. This process of industrialization was also expected to usher in possibilities for the slow growing states to catch up with the fast growing ones. This paper assesses the extent of regional manufacturing performance in India by analyzing the trends in labour and total factor productivity for the organized manufacturing sector of 15 major Indian states. Data Envelopment Analysis is used to compute Malmquist total factor productivity index and its components. The results indicate that labour productivity diverges in the reform era and its growth and TFPG follow more or less a similar pattern. The study also finds that growth in productivity vary considerably across states and this variation in productivity growth can be explained, to a great extent, by differences in infrastructural development at the regional level.JEL ClassificationD24, O47, R11

Value chain, productivity and trade performance in the dairy industry

“…For example, productivity growth without an increase in inputs is the best kind of growth aimed for rather than attaining a certain level of output by increasing inputs, since these inputs are subject to diminishing marginal returns which expressed efficiency in production (Topalova and Khandelwal, 2011;Winkler, 2010). Administrative procedures and public policy play a crucial part in influencing productivity and the considerable variance in productivity growth across states is attributed to regional differences in infrastructural facilities which showed that infrastructure is a key factor to productivity (Kumar, 2006;Babu and Natarajan, 2013). Even with the increased global integration in developing countries, productivity levels between different sectors as well as between firms within a sector are seen to have large gaps which indicated inefficiencies in resource allocation and wastage (Schw€ orer, 2013).…”

“…Productivity was our other independent variable which was operationalized by analysing the quality of the output used in production, the cost incurred while producing the dairy products, the innovation in this production and the income received from the sale of the dairy products (Bakhtiar et al, 2018;Kumar, 2006;Babu and Natarajan, 2013).…”

An Empirical Study of the Economic Status of Punjab Concerning India

“…Furthermore, Weaknesses in Punjab state lies with low industrial wage rates, absences of reservoirs of minerals, and the presence of small-scale units (Babu and Natarajan, 2013).…”

Dynamics of MSME Industry in Uttar Pradesh and Maharashtra: An Analysis of Sugar Firms

“…The past studies that have dealt with the industry or state-level issues related to efficiency and productivity have used disaggregated data either two or three digit level National Industrial Classification (NIC) for the various states or India as a whole (Balakrishnan & Pushpangadan, 1998;Dholakia & Dholakia, 1994;Gangopadhyay & Wadhwa, 1998;Hulten & Srinivasan, 1999;Majumdar, 1996;Pradhan & Barik, 1998). Following this some of studies have utilized ASI data (Babu & Natarajan, 2013;Balakrishnan, 2002;Banga & Goldar, 2007;Das, 2003Das, , 2004Deb, 2014;Deb & Ray, 2014;Ghosh, 2013;Kumar, 2006;Majumdar, 2011;Mukherjee, 2004;Pradhan, 1999;Parameswaran & Prameswaran, 2015;Ray, 2012;Unel, 2003) and some other studies for sugar mills such as Abdulla (2017), Singh (2006) and Kumar & Arora (2009, 2011 used Annual Survey of Industries (ASI) data. In brief, the research on efficiency on the Indian manufacturing sector has been gaining popularity among researchers.…”