Input Usage and Productivity in Indian Manufacturing Plants

51 Pages Posted: 20 Apr 2016

See all articles by Syed Ejaz Ghani

Syed Ejaz Ghani

World Bank

William Kerr

Harvard University - Entrepreneurial Management Unit

Stephen D. O'Connell

CUNY The Graduate Center - Department of Economics; World Bank

Date Written: October 1, 2013

Abstract

This paper analyzes the scale and productivity consequences of varied input use in Indian manufacturing using detailed plant-level data. Counts of distinct material inputs are higher in urban settings than in rural locations, unconditionally and conditional on plant size, and they are also higher in the organized sector than in the unorganized sector. At the district level, higher input usage in the organized sector is generally observed in wealthier districts and those with greater literacy rates. If looking within states, the usage is more closely associated with electricity access, population density, and closer spatial proximity to one of India's largest cities. Plants in the organized sector utilizing a greater variety of inputs display higher productivity, with the effects mostly concentrated among smaller plants with fewer than 50 employees. For the unorganized sector, there is little correlation of input counts and local conditions, for better or for worse, and a more modest link to productivity outcomes.

Keywords: Water and Industry, E-Business, Transport Economics Policy & Planning, Economic Theory & Research, Environmental Economics & Policies

Suggested Citation

Ghani, Ejaz and Kerr, William R. and O'Connell, Stephen D., Input Usage and Productivity in Indian Manufacturing Plants (October 1, 2013). World Bank Policy Research Working Paper No. 6656. Available at SSRN: https://ssrn.com/abstract=2341372

Ejaz Ghani (Contact Author)

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

William R. Kerr

Harvard University - Entrepreneurial Management Unit ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

Stephen D. O'Connell

CUNY The Graduate Center - Department of Economics ( email )

365 Fifth Avenue, 5th Floor
New York, NY 10016
United States

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

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