Crony Capitalism and India: Before and After Liberalization

Mazumdar, Surajit (2008): Crony Capitalism and India: Before and After Liberalization.

Abstract

This paper, the second in the series, initiates the examination of the nature of the relationship between private capital and the State in India. While the principal focus is on the present context of India under a liberal economic policy regime, both the past of Indian capitalism and the past discussion on the concentration of economic power are also brought into the picture to substantiate the key arguments. The paper provides theoretical and also some limited empirical substantiation for the proposition that unlike what would be the prediction of crony capitalism theory, liberalization, rather than reducing the degree of subordination of public authority to private capital, has only facilitated an enhanced degree of state capture

• Item Type: MPRA Paper
• Language: English
• Keywords: India; Crony Capitalism; Liberalization; Concentration
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O2 - Development Planning and Policy; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O16 - Financial Markets ; Saving and Capital Investment ; Corporate Finance and Governance; P - Economic Systems > P1 - Capitalist Systems > P16 - Political Economy

References

Allen, Christopher S (1999), “The Politics of Adapting Organized Capitalism: United Germany, the New Europe, and Globalization”, in Carl Lanowski (ed.), German Politics Under Stress: Exhaustion of the Model?, New York: Berghahn.

Agarwal, V.K. (1987), Concentration of Economic Power and Monopolies in India, Deep and Deep Publications, New Delhi.

Bagchi, A.K. (1980), Private investment in India: 1900‐1939, Reprint of 1975 Indian Edition, Orient Longman (in association with Cambridge University Press), New Delhi.

Bagchi, Amaresh (2004), “Taxing capital Gains: Unending Debate”, Business Standard, 21 July 2004.

Bagchi, Amiya Kumar (1994), “European and Indian Entrepreneurship in India, 1900-1930”, in Ray (ed.) (1994a)

Bajpai, R.G. (1952), “Concentration of Economic Power in India”, Indian Journal of Economics, January, Vol. XXXII, No. 126.

Bello, Walden, Kamal Malhotra, Nicola Bullard and Marco Mezzera (2000), “Notes on the Ascendancy and Regulation of Speculative Capital”, in Walden Bello, Nicola Bullard, and Kamal Malhotra (eds.), Global Finance: New Thinking on Regulating Speculative Capital Markets, University Press, Dhaka and Zed Books, London and New York.

Berle, Adolf A. and Gardiner C. Means (1968), The Modern Corporation and Private Property, Revised Edition, Harcourt, Brace & World, New York.

Bose, S.R. (1952), “Concentration of Economic Power in India”, Indian Journal of Economics, January, Vol. XXXII, No. 126.

Chandra, N.K. (1981/1979), “Monopoly Capital, Private Corporate Sector and the Indian Economy: A Study in Relative Growth, 1931-1976”, in Bagchi and Banerjee (1981) [Also in Economic and Political Weekly, Special Number, August 1979, Vol. 14, Nos. 30–32].

Chandrasekhar, C.P. (2003), “The Diffusion of Information Technology: The Indian Experience”, Social Scientist, July–August, Vol. 31, Nos. 7—8.

Corporate Studies Group (S.K. Goyal, K.S. Chalapati Rao, Nagesh Kumar, Anil Nauriya, B.M. Gupta, Kamal Mitra Chenoy, K.V.K. Ranganathan, M.R. Murthy and D.N. Sharma) (1983a), “Functioning of Industrial Licensing System, Capacity and Production in Organized Industry”, Economic and Political Weekly, April, Vol. 18, No. 5.

Corporate Studies Group (S.K. Goyal, K.S. Chalapati Rao, Nagesh Kumar, Anil Nauriya, B.M. Gupta, Kamal Mitra Chenoy, K.V.K. Ranganathan, M.R. Murthy, and D.N. Sharma) (1983b), “Reporting of Industrial Capacities”, Review of Company Annual Reports, Economic and Political Weekly, Review of Management, May, Vol. 18, No. 22.

Dabholkar, D.A. (1952), “Concentration of Economic Power in India – A Statement of the Problem”, Indian Journal of Economics, January, Vol. XXXII, No. 126.

Dutt, R. Palme (1983), India To-Day, Second Indian Edition, Manisha Granthalaya (P) Ltd., Calcutta.

Ghose, Aurobindo (1972), “Monopoly in Indian Industry: An Approach”, Economic and Political Weekly, February, Vol. 7, Nos. 5-7.

Government of India (1964), Report of the Committee on Distribution of Income and Levels of Living (Mahalanobis Committee), Planning Commission, New Delhi.

Government of India (1965), Report of the Monopolies Inquiry Commission (MIC Report), New Delhi.

Government of India (1966), Report of the Managing Agency Enquiry Committe, Ministry of Law, Department of Company Affairs New Delhi.

Government of India (1969), Report of the Industrial Licensing Policy Inquiry Committee (ILPIC Report), Main Report and Appendices, Department of Industrial Development, Ministry of Industrial Development, Trade and Company Affairs, New Delhi.

Goyal, S.K. (1970), “Concept and Measurement of Concentration of Economic Power”, Company News and Notes, February 1 and 16, Vol. VIII, Nos. 3 & 4.

Goyal, S.K (1979), Monopoly Capital and Public Policy, Allied Publishers Private Limited, New Delhi, Bombay, Calcutta, Madras, Bangalore, Hyderabad.

Goyal, S.K. (1983a), “Private Managements and Takeovers of Public Owned Companies – Some Issues for Debate”, Working Paper No. 7, in Corporate Studies Group (1985).

Goyal, S.K. (1983b), “Public Accountability of Deemed Government Companies”, Working Paper No. 8, in Corporate Studies Group (1985).

Goyal, S.K. (1988), “Nature and Growth of the Indian Corporate Sector” (mimeo), Working Paper, Institute for Studies in Industrial Development, New Delhi

Goyal, S.K., K.S. Chalapati Rao & Nagesh Kumar (1984), “Small Scale Sector and Big Business, Studies in National Development No. 2” (mimeo), Corporate Studies Group, Indian Institute of Public Administration, New Delhi.

Hannah, Leslie (1983), The Rise of the Corporate Economy, Second Edition, Methuen and Co., London and New York.

Hazari, R.K. (assisted by A.N. Oza) (1966), The Structure of the Private Corporate Sector, A Study of Concentration, Ownership and Control, Asia Publishing House, Bombay.

Hazari, R.K. (1967), “Monopolies and Their Regulation in India: Rapporteur’s Summary”, in Indian Economic Association (1967).

Hildyard, Nicholas (1998), “The Myth of the Minimalist State: Free Market Ambiguities”, The Corner House, http://www.thecornerhouse.org.uk.

Joshi, L.A. (1965), The Control of Industry in India: A Study in Aspects of Combination andConcentration, Vora and Co. Publishers Pvt. Ltd., Bombay.

Khanna, Tarun and Krishna Palepu (2000), “Emerging Market Business Groups, Foreign Intermediaries, and Corporate Governance”, in Randall K. Morck (ed.), Concentrated Corporate Ownership, University of Chicago Press, Chicago and London.

Khurana, Rakesh (1981), Growth of Large Business, Impact of Monopolies Legislation, Wiley Eastern Limited, New Delhi.

Kochanek, Stanley A. (1974), Business and Politics in India, University of California Press, Berkley.

Kochanek, Stanley A. (1996), “Liberalization and Business Lobbying in India”, Journal of Commonwealth & Comparative Politics, Vol. 34, No. 3, November, Pp. 155—173.

Kong, Tat Yan (1996), “Corruption and its Institutional Foundations: The Experience of South Korea”, IDS Bulleting, Vol. 27, No. 2.

Kothari, M.L. (1967), Industrial Combinations, A Study of Managerial Integration in Indian Industries, Chaitanya Publishing House, Allahabad.

Levi-Faur, David, “The Global Diffusion of Regulatory Capitalism”, The ANNALS of the American Academy of Political and Social Science 2005, 598, 12.

Mazumdar, Surajit (2008), “Crony Capitalism: Caricature or Category?” [Crony Capitalism and Contemporary India – I], ISID Working Paper No. 2008/02.

Mehta, M.M. (1952a), “Industrial Concentration in India”, Indian Journal of Economics, January, Vol. XXXII, No. 126.

Mehta, M.M. (1952b), Combination Movement in Indian Industry (A Study of Concentration of Ownership, Control and Management in Indian Industries), Friends’ Book Depot, Allahabad.

Mohnot, S.R. (1962), Concentration of Economic Power in India: A Statistical Study of Concentration and Diffusion of Economic Power in India, Chaitanya Publishing House, Allahabad.

Namjoshi, M.A. (1966), Monopolies in India: Policy Proposals for a Mixed Economy, Lalvani Publishing House, Bombay-Calcutta-Madras-New Delhi.

Nellis, John (1999), “Time to Rethink Privatization in Transition Economies?”, Finance & Development, June, Vol. 36, No. 2.

Patnaik, Prabhat (2000), “Introduction” to V.I. Lenin: Imperialism, the Highest Stage of Capitalism: A Popular Outline, Left Word Books, New Delhi.

Rao, K.S. Chalapati (1985), “Inter-Connections under the MRTP Act in the Context of Asset Limit Hike”, Economic and Political Weekly, July 6, Vol. 20, No. 27.

Rao, K.S. Chalapati and Atulan Guha (2006), “Ownership Pattern of the Indian Corporate Sector: Implications for Corporate Governance”, ISID Working Paper No: 2006/09.

Ray, Rajat K. (1985), Industrialization in India, Growth and Conflict in the Private Corporate Sector: 1914-47, Paperback Edition, Second Impression, Oxford University Press, Delhi.

Ray, Rajat Kanta (ed.) (1994a), Entrepreneurship and Industry in India, 1800‐1947, Oxford University Press, Delhi.

Ray, Rajat Kanta (1994b), “Introduction”, in Ray (1994a).

Rodrik, Dani and Arvind Subramanian (2005), “From “Hindu Growth” to Productivity Surge: The Mystery of the Indian Growth Transition”, IMF Staff Papers Vol. 52, No. 2.

Sarkar, Sumit (1983), Modern India, 1885‐1947, Macmillan India Ltd., Madras, Bombay, Delhi, Patna.

Sengupta, Nitish K. (1983), Changing Patterns of Corporate Management, Vikas, Delhi.

Sweezy, Paul M. (1999/1994), “The Triumph of Financial Capital”, in Oritz, Bobbye S. and Tilak D. Gupta (comp.) (1999), History as it Happened, Selected Articles from Monthly Review, 1949–1998, Cornerstone Publications, Kharagpur [Originally Published in theMonthly Review, June 1994].

Vasvani, M.H. (1952), “Concentration of Economic Power in India”, Indian Journal of Economics, January, Vol. XXXII, No. 126.

Virmani, Arvind (2004), “India’s Economic Growth: From Socialist Rate of Growth to Bharatiya Rate of Growth”, Working Paper No. 122, Indian Council for Research on International Economic Relations (ICRIER).