We provide evidence of the role of community networks in emergence of Indian entrepreneurship in early stages of cotton and jute textile industries in the late 19th and early 20th century respectively, overcoming lack of market institutions and government support. From business registers, we construct a yearly panel dataset of entrepreneurs in these two industries. We find no evidence that entry was related to prior upstream trading experience or price shocks. Firm directors exhibited a high degree of clustering of entrepreneurs by community. Consistent with a model of network-based dynamics, the stock of incumbent entrepreneurs of different communities diverged non-linearly, controlling for year and community fixed effects.
Gupta, Bishnupriya, Dilip Mookherjee, Kaivan Munshi, and Mario Sanclemente. 2022. "Community origins of industrial entrepreneurship in colonial India." Journal of Development Economics 159. https://doi.org/10.1016/j.jdeveco.2022.102973.