This book presents perspectives by eminent economists, social scientists and policy makers, exploring in depth the post-reform developments in India, including issues pertaining to growth and equity, issues which have been at the core of life-time work of Prof. R. Radhakrishna. The book brings out how some public policy instruments created to promote growth have turned out to be regressive, promoting inequalities and creating a highly asymmetric federalism in India. It examines the efficacy of fiscal and monetary reforms and also emphasises the need for strengthening the institutions of governance, particularly judiciary and police, in order to boost investors’ confidence. It presents exercises in econometric modelling for explaining factors in growth and vetting policies, and explores the issue of governance and institutions. The book provides insights into the working of an emerging economy and a large democracy which has to strive for public acceptability of the tensions of its negotiations between equity and growth. With its depth of academic excellence and breadth of topics covered, it is a ‘must read’ for researchers, policy makers, industry watchers, think tanks, and NGOs.
Author(s): Saiyed Raza Hashim, Rahul Mukherji, Brajaraja Mishra
Series: India Studies in Business and Economics
Publisher: Springer
Year: 2022
Language: English
Pages: 463
City: Singapore
Foreword
Preface
Contents
Editors and Contributors
Introduction: Inclusiveness in Development Strategies and Policies
1 A Tribute
2 The Disconnect Between Theory and Reality
3 The Historical Context
4 Five-Year Plans—The Gap Between Intentions and Outcomes
5 The Green Revolution—A Saviour
6 Economic Reforms and Growth—Not Good News for Inclusiveness
7 The Festschrift
8 Instruments of Public Policy and Reforms
9 Econometric Modelling
10 Governance and Institutions
11 Poverty and Unemployment
12 Sectoral Perspectives
13 Addressing Challenges in Agriculture
14 Concluding Observations
References
Instrument of Public Policy and Reforms
Interstate Inequalities—Scope and Limits of Public Policy
1 Introduction
2 Framework: Institutions and Instruments
2.1 Finance Commission
2.2 Planning Commission
2.3 Access to Domestic Debt
2.4 Access to External Debt
2.5 Institutional Credit
2.6 Concessions and Subsidies
2.7 Constitutional Design: Asymmetrical Federalism
3 Conclusion
Fiscal Dominance of Monetary Policy: Global and Indian Experience
1 Introduction
2 Theoretical Underpinning
3 International Experience with Fiscal Dominance
4 Post-GFC Developments
5 Relevance for India
6 Empirical Estimation of Fiscal Dominance in India
7 Extraordinary Situations, Extraordinary Measures
8 Conclusion
Appendix
References
Post-pandemic Revival Strategy for India
1 Introduction
2 Aspirational Targets and the Setting for Reforms
3 Economic Contraction and Fiscal Impact
4 Need to Fast Track Reforms
5 Concluding Remarks
References
Law and Economics of Pure Economic Loss in Tort
1 Introduction
2 The Compensation of Pure Economic Loss in Tort Law
2.1 The Delimitation of Compensation for Pure Economic Losses
2.2 Over-Deterrence in the Event of Overcompensation for Pure Economic Losses
2.3 Effect of Liability for Pure Financial Losses with Precise and Imprecise Standards of Care
3 Cases Where Liability Should Be Extended
3.1 The Pure Economic Loss is a Resource Loss in Its Entirety
3.2 Compensation of Pure Economic Loss if the Injured Party Pays for the Protection Within a Market Relation
3.3 Pure Financial Losses in Tort Law Versus Contract Law, the Goldberg Proposition
4 Conclusion
References
Econometric Modelling
Macroeconomic Foundation of Functioning of the IMF: An Evolutionary Journey
1 Introduction
2 Early Macroeconomic Thinking of the IMF
3 Polak (1957) Model and Its Variants
4 Financial Programming Models
4.1 Khan, Motinel and Haque (1990)’s Model
4.2 Some Critiques
5 IMF’s MULTIMOD Model
6 More Recent Modelling Exercises at the IMF
7 Modelling in Post-global Financial Crisis
8 Concluding Observations
References
Assessing Policy Initiatives to Accelerate Economic Growth: An Illustration Using a Macroeconometric Model for India
1 Introduction
2 Data Trends and the Macro-Economy
2.1 Output and Prices
2.2 Investment and Savings
2.3 Public Finance
2.4 External Sector
2.5 Poverty
2.6 Financial Sector
2.7 Devaluation
2.8 Demonetization
2.9 Other Policy Simulations
3 Summary and Conclusion
Appendix 1
Appendix 2
Appendix 3
Appendix 4
Appendix 5
References
Determinants of Economic Growth Across States in India
1 Introduction
2 Literature on Determinants of Growth
2.1 Studies Related to India
3 An Overview of Selected States
4 Methodology and Estimation
4.1 Empirical Model Specification
4.2 Endogeneity
5 Data and Variables
5.1 Data Sources
5.2 Infrastructure Index
5.3 Social Sector Expenditure
5.4 Financial Inclusion
5.5 Urbanization
5.6 Fiscal Discipline
6 Regression Results
7 Conclusions
References
Progress in Applied Econometrics in India: A Selective Review
1 Introduction
2 Guide to Modern Econometric Methods Based on Four Books
3 Some Important Literature of the 1950s and 1960s
4 Literature of the 1980s and 1990s
5 Recent Indian Macroeconometric Models
6 Bayesian VARs, Structural Models, and DSGE Models
6.1 Bayesian VARs
6.2 A Structural Macroeconometric Exercise Focusing on Debt and Deficits of the Union Government
6.3 DSGE Modelling for the Indian Economy
6.4 Econometric Analysis of Public Debt Sustainability of Indian States
7 Economic Well-Being and Deprivations in India
8 Studies in Econometrics of Diets and Child Undernutrition
8.1 Gaiha, Jha and Kulkarni (Eds., 2014)—Diets, Malnutrition and Disease: The Indian Experience
8.2 Causal Estimates of the Impact of ICDS on Children’s Diets
9 Studies on Firm-Level Productivity, Exports, FDI, and Competitiveness
9.1 K. Narayanan and S. K. Sahu (2020), Firm-Level Productivity and Exports: The Case of Manufacturing Sector in India
9.2 Chawla (2020), Foreign Involvement and Firm Productivity: An Analysis for Indian Manufacturing, Service, Construction and Mining Sectors
9.3 R. Banga and K. Banga (2020), Digitalization and India’s Losing Export Competitiveness
10 Contributions on Urban Slums, Rural Labour Market, and Chronic Poverty
10.1 Arup Mitra and Yuko Tsujita (2016)—Issues in Upward Mobility: Study Based on Longitudinal Data from Delhi Slums
10.2 S. Khanna, D. Goel, and R. Morissette (2016): Decomposition Analysis of Earnings Inequality in Rural India: 2004–2012, IZA Journal of Labour and Development (2016) 5:18
10.3 Brief Review of a Recent Book on Dimensions of Poverty in India
11 Concluding Remarks
References
Governance and Institutions
Governing India: What Do We Know and Need to Know?
1 Introduction
2 Clientelism and the Pathologies of Democracy
3 The Governance Literature
3.1 The Puzzle
3.2 The Approach
3.3 Ideas Matter
3.4 Ideas and the Indian State
3.5 The Tipping Point
3.6 India’s Globalization
4 MGNREGS in Andhra Pradesh
5 What Do We Know and Need to Know?
References
NITI Aayog—An Alternate Think Tank
1 Introduction
1.1 Rationale
1.2 Roles and Functions
1.3 Organizational Design
1.4 Functional Architecture
1.5 Major Initiatives in the Past Four years
2 Inevitability to Dissolve the Planning Commission and to Create a New Institution to Do What the NITI Aayog is Doing?
3 Concluding Remarks: Case for Redesigning NITI Aayog
References
Indian Official Statistical System
1 Constitutional Provisions on Statistics
2 Legal Basis for Collection of Statistics
3 Administrative Statistics
4 Institutional Arrangements and Problems
5 Nodal Role and Statistical Coordination
6 Sequence Followed in Production Process
7 General Problems in Some Statistical Products
8 International Participation
9 Independence of the Statistical System
10 Way Forward
References
Poverty and Unemployment
Poverty in India: Measurement, Trends and Other Issues
1 Introduction
2 Approaches of the Earlier Committees
3 Suggested Methodology by Expert Group (Rangarajan)
4 Clarifications on the Issues Raised by Others
4.1 What is New in the Approach for Poverty Line?
4.2 Use of Calories
4.3 Non-food Criteria
4.4 Poverty Estimation: Headcount and Depth
4.5 Multidimensional Poverty
4.6 Higher Urban Poverty in Many States
4.7 NSS and SECC
4.8 Measurement of Poverty Based on NSS Estimates
5 Conclusion
References
A Note on Unemployment and Its Measurement in India
1 Introduction
2 Theoretical Framework
3 Analysis of Unemployment in India
4 Discussion and Conclusions
References
Sectoral Issues
Towards Inclusive Urbanisation in India
1 Introduction
2 Economic Growth and Urbanisation
3 Pattern of Urbanisation
4 Urban Concentration
5 Growth of Informal Urban Settlements
6 Rural-to-Urban Migration
7 Urban Poverty
8 Conclusion
References
Addressing Visible Inequalities: The Minimum Policy Agenda
1 Introduction and Outline
2 The Inequality Discourse
3 Dimensions of Visible Equality
4 Government Schools and Visible Equality
5 In Conclusion
Annex: 37 Nations’ Data on Population Share, Private Schooling % and GDP/Cap
References
‘Khadi’ Under the Neoliberal Economic Dispensation: Relevance and Issues
1 Introduction
2 Growth of Production, Sales and Employment in Khadi Sector
2.1 Regional Variations Over-Time
2.2 Analysis of Spatial Performance of Khadi Subsectors
3 Production of Khadi and the Poverty Correlates
4 The Contemporary Context
5 Reforming Khadi: The Asian Development Bank Interventions
6 Khadi from Freedom Fabric to Fashion Fabric:13
6.1 Technological Innovations and Khadi
7 Khadi: Going Beyond Economic Cost–Benefit: A Case of Saurashtra Rachanatmak Samiti (SAURAS)
8 Future Value of Khadi
9 In Lieu of Conclusion
Appendix: Annexure I
Annexure II
References
Water Security in India: Three Scenarios for 2040
1 Introduction
2 Development and Economic Growth in India Since Early 90s
3 The Future Water Requirements for Different Sectors in India
3.1 The Assumptions
3.2 Water Requirement Projections
4 Balancing the Demands of Water in Different Sectors with Potential Future Water Supplies
5 Technology, Governance and Environment
6 Concluding Remarks
References
Agriculture
The Viability Crisis and Institutional Challenges Before Indian Agriculture
1 Introduction
2 Focus Needed on the Farmer, not Merely on Farming
3 The Worsening Viability
4 Implications of the Situation
5 Towards a Solution
References
Bane of Agriculture: Persistent Slowdown in Public Sector Investment
1 Belated but Perfunctory Recognition of the Agriculture’s Neglect
2 Key Data Series Evidencing the Phase-Wise Trends in Farm Investment Depicted Above
3 Private Sector Investment Behaviour—Departure from the Trend After the Commodity Bloom During 2000–01 Onwards
4 Alleged Trade-offs Between Subsidies, Agricultural Investment and Other Productive Expenditures
5 Role of Institutional Credit in Private Investment in Agriculture
6 Concluding Observations
Appendix
References
Oil Palm for Edible Oil Security in India
1 Introduction
1.1 Oil Palm Area Expansion (OPAE) Programme in India
2 Findings from the Primary Survey
2.1 Profitability Differences Between Exotic and Indigenous Varieties
2.2 Subsidy Provision and Capacity Building Under Oil Palm Development
2.3 Farmers’ Perception About Oil Palm Development Programme
3 Conclusions and Policy Suggestions
References
Accelerating Farm Income Growth: Opportunities and Challenges
1 Introduction
2 State of Farm Income in India
3 Strategies for Doubling Farm Income
3.1 Enhanced Procurement by State Agencies
3.2 Improved Market Infrastructure
3.3 MSP Be Fixed Based on Cost C2 + 50% Formula
3.4 Need to Implement PM-AASHA with Full Spirit
3.5 Right to Sell at MSP
3.6 Changes Needed in Restrictive Policies
3.7 Measures to Reduce Cost of Cultivation
4 Concluding Remarks
References
