Curbing crony capitalism in India

Sen, Chiranjib (2017) Curbing crony capitalism in India. Working Paper. Azim Premji University, Bengaluru.

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Economic reforms sought to replace the Indian statedominant economy with a liberal, competitive market economy. However, a plethora of recent scams indicate that collusive rentsharing arrangements between business and policy makers are prevalent. A nexus has developed, linking politicians and business, as well as the bureaucracy. These trends signal a breakdown of competitive markets and the accumulation of wealth via corruption. This paper explains crony capitalism within a framework of interaction between four stakeholder groups whose motives and behaviour have altered in the recent context. These are political executives, political parties, business entities and the bureaucracy. Using the coal mine block allocation controversy as a case study, we examine the modus operandi of crony capitalism as a capture of the policy process. We examine the limitations of the present corrective political and legal processes. The paper concludes with a set of recommendations for curbing crony capitalism via reform of: (a) the political funding system, (b) the policy process, (c) the audit institution and (d) the business environment.

Item Type: Monograph (Working Paper)
Authors: Sen, Chiranjib
Document Language:
Uncontrolled Keywords: crony capitalism; rent-seeking; government-business relations; institutional reform
Subjects: Social sciences > Economics
Divisions: Azim Premji University > University Publications > Working Paper
Full Text Status: Public
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Note: The working paper series aims at reflecting the range of work done across the Azim Premji Foundation, including the Field Institutes and the University, and disseminating this work to a broader audience. University faculty, members of Field Institutes of the Foundation as well as students graduating from the University may contribute to the series. The findings, interpretations and conclusions expressed in these papers are entirely those of the authors and do not necessarily represent the views of Azim Premji University.
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