State-Business Relations
Macro studies
The set of projects below examine this relationship between effective SBRs and economic growth at the macro level. The studies address how state business relations should be measured and how SBRs, as captured by these measures, affect economic growth across Sub-Saharan African countries and Indian states over time.
- The current Indian macro study will assess how state-business relations have evolved in the main Indian states during the last thirty years. It will do so by constructing quantitative annual indices of SBR quality for each state based on extensive primary and secondary data collection. The indices will allow comparison of Indian states over time against specific dimensions of SBRs and will allow testing for the impacts of effective SBRs on economic growth and firms' performance.
- 'Measuring state-business relations in Sub-Saharan Africa' by Dirk Willem te Velde (2006).
- 'State-business relationships and economic growth in Sub-Saharan Africa by Dirk Willem te Velde and Kunal Sen (2007) from the IPPG project
A second IPPG discussion paper by Mahvash Qureshi and Dirk Willem te Velde, 'State-Business Relations and Firm Performance in Zambia' is also available.'Econometric analyses measuring the impact of effective state-business relationships on pro-poor growth (Africa and Asia)'.
- IPPG Briefing Paper 'State-business relations, investment climate reform and economic performance in Sub-Saharan Africa' by Dirk Willem te Velde (2007).
Micro studies
The micro-econometric studies examine the effects of state-business relations on firm performance. The studies will use panel data and cross-sectional econometric methods to ascertain:
- whether the differences in the evolution of state business relations had clear and robust effects on firm productivity;
- whether these effects differed by the size, ownership and location of the firm.
The IPPG discussion paper 'State-business relations, investment climate reform and firm productivity in Sub-Saharan Africa' by Mahvash Qureshi and Dirk Willem te Velde June (2007), investigates this in a Sub-Saharan context.
A second IPPG discussion paper by Mahvash Qureshi and Dirk Willem te Velde, 'State-Business Relations and Firm Performance in Zambia' is also available.
The current Indian micro studies will estimate the effects of changing state business relations on firm and industry productivity for all states in India. The studies will examine:
- whether the effects of SBRs on economic performance differ by firm size and ownership;
- whether the firm belongs to the formal or informal sector; and
- by technological complexity of the industry.
The studies will use a unique micro-data set that combines firm-level data from the formal (organised) and informal (unorganised) segments of the Indian manufacturing sector.
Case Studies
This set of papers and projects address the origins of effective and ineffective SBRs, and how they are formed, maintained or changed. The studies are undertaken by economists and political scientists and mostly adopt a historical institutionalist approach.
- 'The politics of state-business relationships in Malawi by Henry Chingaipe and Adrian Leftwich (2007), from the IPPG project 'The politics of state-business institutional relations'.
- 'The decline and recent resurgence of the manufacturing sector of West Bengal: implications for pro-poor growth from an institutional point of view by Ajitava Raychaudhuri and Gautam Kumar Basu (2007), from the IPPG project 'The dynamics of state-business relations and their impact on pro-poor growth in manufacturing'.
- 'The role of organisations in the growth of rural non-farm Sector in Bangladesh by Atiur Rahman, Taiabur Rahman and Taifur Rahman (2007), from the IPPG project 'The local government engineering department and its role in the growth of the rural non-farm economy'.
- There are two IPPG case studies based in Ghana: State-business relations and economic growth in Ghana, based at ISSER (Institute of Statistical Social and Economic Research, Ghana); and The institutional context of industrial investment selection, based at Heriot Watt University.
- There are two IPPG case studies based in Zambia: SBRs in Zambia: a focus on the mining sector and How State-Business Relations Influence Fiscal Policy and Budgeting in Zambia.
- The current SBR research cluster also includes State-business relations (SBRs) and economic growth in South Africa; and
- State-business relations (SBRs), economic growth and firm performance in Mauritius
- Henry Chingaipe, one of the IPPG supported Ph.D. students, is also undertaking a case study of Malawi.
Back to state-business relations portal.
The Economics and Politics of State-Business Relations in Africa - Preliminary Findings
This 2008 publication contains a series of four papers highlighting economic and political approaches toward studying state-business relations. Edited by Adrian Leftwich, Kunal Sen and Dirk Willem te Velde.
Download the PDF here
Indian case-studies
While growth has accelerated in India since the 1980s, growth and poverty reduction outcomes have differed widely across Indian states. The differential paths of Indian states with respect to poverty reduction and economic growth since the reforms of the 1980s and 1990s seem to be related to some degree to the nature of state-business relations at state level. Hence they are intimately related to political processes within the state, including the distribution of formal and informal power between states and businesses, as well as the ideology and electoral concerns of political parties.
The current Indian case-studies will examine the political, sociological and economic determinants of state-business relations in three states, Andhra Pradesh, Orissa and West Bengal.
- Andhra Pradesh is widely regarded as a success with respect to economic growth, especially in the manufacturing sector.
- Orissa has been characterised by weak economic growth and poverty reduction.
- West Bengal has seen stagnation in the formal manufacturing sector, coupled with strong growth in the informal manufacturing sector.
The case-studies will examine what characterises the nature of state-business relations in these three states. They will explore whether the changing nature of state-business relations in these states (or lack thereof) has been influential in the different trajectories of these three states in economic performance relating to the manufacturing sector.
Last modified: 29 April 2009