Essay Gabriela Valdes 1 Chapter Question

1036 Words Sep 25th, 2014 5 Pages
Chapter 3
1. What is the relationship among property right, corruption, and economic progress? How important are anticorruption efforts in the efforts to improve a country’s level of economic development? Corruption can reduce growth but also how it can increase growth, for example, by avoiding bureaucratic delays. The results of cross-country empirical literature on the effect of corruption on growth are mixed. Since corruption is an incendiary topic that elicits much anger, it is also important to exercise caution and to pursue rational anti-corruption policies. The issue of data collection and accurate detection of corruption is vital again in this case, since sanctioning an entire group of people for corruption when only a subgroup
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The economic system that developed in India after 1947 was a mixed economy characterized by a large number of state-owned enterprises, centralized planning, and subsidies. In 1991, India’s government embarked on an ambitious economic reform program. Much of the industrial licensing system was dismantled, and several areas once closed to the private sector were opened. In addition, investment by foreign companies was welcomed, and plans to start privatizing state-owned businesses were announced. India has posted impressive gains since 1991, however there are still impediments to further transformation. Attempts to reduce import tariffs have been stalled by political opposition from employers, employees, and politicians. Moreover, the privatization program has been slowed thanks to actions taken by the Supreme Court. Finally, extreme poverty continues to plague the country
B. How might widespread public ownership of businesses and extensive government regulations have affected (i) the efficacy of state and businesses, and (ii) the rate of new business formation in India during the 1947-1990 time frame? How do you think these factors affected the rate of economic growth in India during this time frame?
The mixed economy that developed in India after 1947 was characterized by a large number of state-owned enterprises, centralized planning, and subsidies. This system not only constrained the growth of the private sector, but it also
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