What will open the door to across-the-board economic growth in India? A range of state reforms from 1986 to 2005 increased competition and lowered barriers to trade, yet certain sectors and industries have remained stubbornly resistant to change. New research by HBS professor Laura Alfaro and coauthor Anusha Chari probes the effectiveness of these reforms at the firm level.

"Despite the substantial increase in the number of private and foreign firms, the overall pattern that emerges after close to two decades of reforms is one of continued incumbent dominance in terms of assets, sales, and profits [in] state-owned firms and traditional private firms," they write in "India Transformed? Insights from the Firm Level 1988-2005."

Their article (also available as a working paper) increases our understanding of the promise—and the limitations—of economic liberalization.

— Martha Lagace

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