Enterprise informality in India: The blind spots in public policy
By: Mehrotra, Santosh and Giri,Tuhinsubhra
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Material type: 
BookPublisher: The Indian Journal of Labour Economics Description: 66(3), Jul-Sep, 2023: p.687-710.
In:
The Indian Journal of Labour EconomicsSummary: An essential characteristic of firm size distribution patterns in developing countries including India, is a bimodal distribution with a “missing middle”, which is widely accepted in development economics. We analyse data from the Annual Survey of Industries (ASI), National Sample Survey (NSS) and Economic Census to assess the firm size structure of the whole non-farm sector. The contribution of the paper is that for the first time a comprehensive database is constructed to enable analysis of the size structure of India’s non-farm enterprises. The second contribution is that we find a deep distortion in India, with even a “small”-scale sector being very small, relatively. We examine briefly the policy-related causes that make India an outlier even among Asian economies in respect of size structure of enterprises. Finally, we argue that the historically policy-induced informality of enterprises is being entrenched by the current hiatus in state policy in even recognising the true nature of the problem of micro, small & medium enterprises (MSMEs), which holds back both their growth and employment. – Reproduced
https://link.springer.com/article/10.1007/s41027-023-00450-9
| Item type | Current location | Call number | Vol info | Status | Date due | Barcode |
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Articles
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Indian Institute of Public Administration | 66(3), Jul-Sep, 2023: p.687-710 | Available | AR130516 |
An essential characteristic of firm size distribution patterns in developing countries including India, is a bimodal distribution with a “missing middle”, which is widely accepted in development economics. We analyse data from the Annual Survey of Industries (ASI), National Sample Survey (NSS) and Economic Census to assess the firm size structure of the whole non-farm sector. The contribution of the paper is that for the first time a comprehensive database is constructed to enable analysis of the size structure of India’s non-farm enterprises. The second contribution is that we find a deep distortion in India, with even a “small”-scale sector being very small, relatively. We examine briefly the policy-related causes that make India an outlier even among Asian economies in respect of size structure of enterprises. Finally, we argue that the historically policy-induced informality of enterprises is being entrenched by the current hiatus in state policy in even recognising the true nature of the problem of micro, small & medium enterprises (MSMEs), which holds back both their growth and employment. – Reproduced
https://link.springer.com/article/10.1007/s41027-023-00450-9
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