requirements with treated and nontreated sectors are captures by the coefficients on T T T × L and T T T × L , respectively. TT mm mm NNTT mm mm

# 5. Data

## _5.1 Locations, distance and employment_

The Economic Census of India is used to compute the total employment and number of firms for towns and villages and for sectors in each town or village (MOSPI 2013). We use the 2013 round of the Economic Census for our baseline results and the 1990 and 1998 rounds for robustness checks. We geo-reference all three rounds of the Economic Census to digitized boundaries of administrative units in India, available down to the town or village level. These boundaries are based on India’s Administrative Atlas _2011_ (ORGI 2011b) and were generated as part of a broader research project, the Spatial Database for South Asia (Li et al. 2015).

For each round of the Economic Census, we achieve the geo-refence through two steps. First, we create a concordance between the town/village codes used by the Economic Census and those of the Population Census of India 2011 (ORGI 2011a). 7 Second, we match the town/village codes used by the Population Census with those of the digitized administrative units, using an official concordance and addressing some additional mismatches not covered by the concordance (ORGI 2011b).

We obtain the spatial coordinates of all towns and village from the digitized boundaries of administrative units. Thereafter, we use the Open Source Routing Machine and take advantage of the road network data from OpenStreetMap to calculate the shortest driving distance from all towns and village to the border between Uttarakhand and Uttar Pradesh.<sup>8</sup> The Economic Census of India enumerates almost all non-farm establishments, including single-worker to the largest establishments, formal and informal, from both manufacturing and services sectors. For our analysis, we include all non-agricultural economic sectors, excluding public administration and defense. The 2013 Economic Census uses the three-digit National Industrial Classification 2008 (NIC 2008) to classify sectors. We follow this nomenclature in the following analysis.

Several studies have confirmed the Economic Census as a good source to study the spatial characteristics of establishments in India over longer periods. However, it has a coverage issue related to micro enterprises at the left-most end of the firm-size distribution (Amirapu et. al 2019; Manna 2010; and Raveendran 2006). Following the literature, we exclude establishments with fewer than five workers from the baseline analysis. And we use these observations in robustness checks.

In terms of places, we restrict to the towns and villages within 100-kilometer driving distance from the border in both Uttar Pradesh and Uttarakhand. Overall, there are 19,088 towns and villages in this area. Among them, over 4,100 were not canvassed in the 2013 round of the Economic Census, because of the

> 7 We use the Socioeconomic High-resolution Rural-Urban Geographic Dataset for India (SHRUG) to match the 1990 and 1998 Economic Census to the 2011 Population Census (Asher et al. 2019).

> 8 - Open Source Routing Machine can be accessed at http://project <u>osrm.org/.</u>

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