ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Some Reflections on Agrarian Prospects

Indian agriculture is once again in a slowdown. After the spurt of 2004-05--2011-12 when growth accelerated and the variability of production declined, in recent years growth has slowed and volatility has risen. Given weak world economic prospects and looming climate change, the main objectives of agricultural policy should now be to (i) enhance efficiency of production and natural resource use, and (ii) devise appropriate safety nets to cope with risks whether from markets or climate.

Clarification on PDS Leakages

This note outlines the methodological reasons for the (small) differences in estimates of leakages from the public distribution system in 2011-12, as reported in Himanshu and Abhijit Sen (EPW, 16 and 23 November 2013) and Drèze and Khera (EPW, 14 February 2015).

Do Not Dilute NREGA

[An Open Letter to the Prime Minister on NREGA by economists based in India and elsewhere in the world.] We are writing to express our deep concern about the future of India’s National Rural Employment Guarantee Act (NREGA). The NREGA was enacted in 2005 with unanimous support from all political...

In-Kind Food Transfers - II

Part-II reports the impact of in-kind food transfers on nutritional intake as measured by calories. Econometric analysis using a simple calorie demand function confirms the significance of variables relating to public distribution system access, controlling for other covariates, in its contribution to calorie intake. Results also suggest that the calorie-elasticity of PDS transfers is twice as large compared to additional out-of-pocket income equal to the cash equivalent of PDS transfers. These are also confirmed by non-parametric analysis of calorie intake of various consumer groups. Although preliminary, these results suggest caution in advocating cash transfers as substitute of in-kind transfers. Finally, the paper evaluates concerns about the financial implications of the minimum support price-PDS system in light of the recently enacted National Food Security Act.

In-Kind Food Transfers - I

This paper, in two parts, reports an evaluation of existing in-kind food transfers. Part I outlines the dimensions involved, in terms of reach, transfer content and physical leakages, and deals with the impact of these transfers on poverty as officially measured. Part II reports the impact of these transfers on calorie intakes and also discusses some issues regarding the financial cost of these transfers. Contrary to the view that food self-sufficiency and income growth have reduced the need for direct food interventions, the paper reports a significant increase in contribution of in-kind transfers to both poverty reduction and nutrition. Moreover, much of this increased impact is attributable to improved public distribution system efficiency. The first part, presented here, was motivated by some issues that arose in the context of the Tendulkar method of estimating poverty as regards its treatment of food prices. This method treats food prices differently from the earlier Lakdawala method and is sensitive to treatment of in-kind food transfers. The paper suggests a decomposition method that modifies the Tendulkar poverty lines and distinguishes between household out-of-pocket expenditures and transfers received from the PDS and mid-day meals. The poverty reducing impact of these food transfers is found to have increased over time and is more pronounced in the case of distribution-sensitive measures of poverty.

Why Not a Universal Food Security Legislation?

The National Advisory Council has given its final proposals on the proposed National Food Security Act. A government-appointed committee (the Rangarajan Committee) has also given its response to these proposals. Both these proposals agree on the desirability of a universal nfsa but finally propose targeting at the poor as defined by the Tendulkar Committee. This has been justified in view of the constraints set by foodgrain procurement and management. This paper argues that a universal nfsa is not only desirable, it is also a more efficient and feasible way to ensure food security for all. While presenting a critique of some of the assumptions made by these two proposals, this paper also offers an alternative which is near universal and feasible without using below poverty line targeting that has proved to be a colossal failure. This alternative, based on the results of a recent pilot for the bpl Census and which takes on board the concerns of its detractors, can be a way forward to a universal nfsa.

Poverty and Inequality in India-II

Part I had critically examined previous 'adjustments' to the 55th round of the NSS, and offered corrections. Part II puts this round in the context of other NSS rounds to examine the 1990s trends in their entirety. It is now certain that economic inequality increased sharply during the 1990s in all its aspects and, as a result, poverty reduction deteriorated markedly despite higher growth. This has implications for policy, and lessons for future survey design.

Poverty and Inequality in India - I

The 55th round (1999-2000) of the NSS used a different methodology from all previous rounds and arrived at lower poverty estimates. The consensus from earlier NSS rounds, that poverty reduction had been set back during the 1990s, was challenged by this data. This was bolstered by some 'adjustments', which although agreeing that the 55th round had overestimated poverty reduction, claimed that the number of poor had nonetheless fallen by 30-45 million. However, a detailed re-examination shows that these 'adjustments' were not correct. The poverty ratio fell at most by 3 percentage points between 1993-94 and 1999-2000, and it is likely that the number of poor increased over this period. The main lesson is that poverty estimates are very sensitive to both survey design and post-survey analysis. The first of a two-part article.

East Asian Dilemma Is There a Way Out

East Asian Dilemma: Is There a Way Out? Jayati Ghosh Abhijit Sen C P Chandrasekhar The financial crises in east and south-east Asia show no signs of resolution, and the IMF medicine that is being imposed on several of the most badly affected economies may actually intensify their problems. But are there any other options now available to countries that had based their rapid economic growth on high rates of investment combined with a mercantilist export strategy?

All Dressed Up and Nowhere to Go-India Infrastructure Report

All Dressed Up and Nowhere to Go India Infrastructure Report Jayati Ghosh Abhijit Sen C P Chandrasekhar The basic strategy proposed in the India Infrastructure Report prepared by the Expert Group on the Commercialisation of Infrastructure Projects appointed by the ministry of finance is for the government to retreat as investor, to provide space for private participation, even while continuing to facilitate and provide numerous financial crutches for the private sector. But even all of these very expensive measures do not guarantee that the private sector would respond positively to invest in areas which are both risky and not-so-profitable.

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