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Towards a location-sensitive policy for manufacturing in Karnataka

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  • Narendar Pani

Abstract

As states have moved to attract investments in the post-liberalisation era, two distinct patterns have emerged. Some states have focused on their largest city, while others have adopted a more dispersed strategy of attracting investment. Taking the experience of Karnataka, this paper looks at the consequences of concentrating on a single centre to boost industrialisation. Using insights from Krugman’s new economic geography, it first isolates the factors contributing to agglomeration to argue that Karnataka’s industrialisation has been Bengaluru centric. It goes on to identify the adverse consequences of concentrating industrial activity in a single city, and points to some of the challenges to moving towards a policy that is more sensitive to issues of location. Copyright Institute for Social and Economic Change 2015

Suggested Citation

  • Narendar Pani, 2015. "Towards a location-sensitive policy for manufacturing in Karnataka," Journal of Social and Economic Development, Springer;Institute for Social and Economic Change, vol. 17(1), pages 50-65, April.
    • Handle: RePEc:spr:jsecdv:v:17:y:2015:i:1:p:50-65
    DOI: 10.1007/s40847-015-0001-8
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    References listed on IDEAS

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    1. Masahisa Fujita & Paul Krugman & Anthony J. Venables, 2001. "The Spatial Economy: Cities, Regions, and International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262561476, April.
    2. Anne O. Krueger, 2009. "The Missing Middle," Macroeconomics Working Papers 22171, East Asian Bureau of Economic Research.
    3. Sharma, D. Parameswara & Nair, P. S. Chandramohanan & Balasubramanian, R., 2005. "Performance of Indian power sector during a decade under restructuring: a critique," Energy Policy, Elsevier, vol. 33(4), pages 563-576, March.
    4. Anne O. Krueger, "undated". "The Missing Middle," Indian Council for Research on International Economic Relations, New Delhi Working Papers 230, Indian Council for Research on International Economic Relations, New Delhi, India.
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