After the 'License Raj': Economic Liberalization and Aggregate Private Investment in India

摘要: Using three alternative models that incorporate the behavior of both credit constrained and unconstrained firms in a theoretically consistent manner, this paper presents evidence on effects economic liberalization 1991 aggregate private investment India. Two robust conclusions emerge from estimation function by ARDL approach. First, response with respect to relative cost capital has increased at least 4.6 times after dismantling 'License Raj'. Second, implies significant improvement technological efficiency during post-liberalization period. In contrast, no conclusion can be drawn about severity constraint faced sector following liberalization.