Economic development in India: The role of individual enterprise (and entrepreneurial spirit)

Abstract

The Indian economy provides a revealing contrast between how individuals react under a government-controlled environment and how they respond to a market-based environment. Evidence suggests that recent market reforms that encouraged individual enterprise have led to higher economic growth in that country.

Foreign Direct Investment, Trade Openness and GDP in China, India and Mexico

“…It is this innovative behavior that leads to productivity increase and this causes economic growth. Entrepreneurship thrives in an open competitive environment in which individual property rights are respected and enforced (Lal and Clement, 2005). Greater exposure to foreign influences, particularly trade and investments, can lead to greater dissemination of knowledge and this can enable greater productivity increases through imitation and adaptation.…”

“…This strategy provided a business environment in which there was no competitive pressure or incentive for these units to be cost efficient or strive for a larger market share by being more innovative. This strategy yielded inefficient production structure, devoid of any technical improvements that were taking place around the world and at the same time encouraged and led to a very corrupt and inefficient system of administration (Lal and Clement, 2005).…”

Self-Help Groups in Indian Agriculture: A Case Study of Farmer Groups in Punjab, Northern India

“…The government also regulated private sector economies through a complex system of controls. In addition, the Indian economy was sheltered from foreign competition through the use of both the "infant industry argument" 1 that provided price support for some agricultural commodities, and a binding foreign exchange constraint (Lal and Clemant 2005). The high level of subsidies provided by the government led to a payment crisis by the early 1990s and it also led to a series of economic reforms.…”

Financial Management Practices

“…Domestic producers were sheltered from competition not only from abroad but also from within India itself (Lal and Clement 2005 ). Domestic producers were sheltered from competition not only from abroad but also from within India itself (Lal and Clement 2005 ).…”