Large Agglomerations and Economic Growth in Urban India: An Application of Panel Data Model

This paper investigates the impact of urban agglomeration on urban economic growth, using static and dynamic panel data approach, based on data of 52 large cities in India for the period 2000 to 2009. The results shows that agglomeration has a strong positive effect on urban economic growth and support the “Williamson hypothesis” that agglomeration increases economic growth only up to certain level of economic development. The critical level per-capita city income is estimated about Rs. 37049 per-capita at 1999-2000 constant prices. In addition, the results indicate that human capital accumulation promotes urban economic growth.