Monopoly Capital and Stagnation: The Case of India

Abstract

The Indian economy has grown at a rapid pace, but over the past decade or so, corporate investments have faltered. Given the scale of what has been unfolding, a large literature has emerged on the investment slowdown. But even as a wide variety of explanations has emerged, within these debates there has been a conspicuous silence on the role played by corporate power in driving the investment trends. It is in this overall context that this article draws on the monopoly-stagnationist perspective associated with Baran and Sweezy to investigate the intricate linkages between corporate power and investment dynamics in twenty-first-century India. The analysis reveals that even as corporate power has expanded over the last two and a half decades, the rising tides of corporate concentration have gone hand in hand with a growing reticence on the part of capitalists to invest their profits in physical capital. The analysis therefore points to the need to bring corporate power back into the discussions on the investment slowdown.

JEL Classification: B5, O1, P0