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

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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).

Changing Voting Patterns in Rural West Bengal

This paper uses two successive rounds of voter surveys in rural West Bengal in a household panel to find reasons for the recent decline in the Left Front's political popularity. It does not find evidence of any significant role of changes in voter age distribution, media exposure, private benefits received from development and welfare programmes administered by local governments, or the vote-generating effectiveness of such programmes. A more important role was played by voter dissatisfaction with local leaders on corruption and lack of involvement in the provision of education services, and with non-local leaders on attitudes towards women, the poor, and local communities.

Land Acquisition and Compensation

The web version of this article corrects errors that appeared in the print edition. There has been a renumbering of two tables and a new table that was not printed has been included. Please see Tables 3a and 3b (page 35).

This paper reports results of a household survey in 12 Singur villages, six in which lands were acquired for the Tata car factory, and six neighbouring villages, with random sampling of households within each village. The results show that (a) the size of plots acquired were non-negligible; (b) the majority of those affected were marginal landowners engaged in cultivation; (c) the government's compensation offers were approximately equal to the reported market values of acquired plots on average, but the inability of the official land records to distinguish between plots of heterogeneous quality meant that a substantial fraction of farmers were under-compensated relative to market values; (d) those under-compensated were significantly more likely to refuse the compensation offers, as were those whose livelihoods were more dependent on agriculture; (e) incomes and durable consumption of affected owners and tenants grew slower between 2005 and 2010 compared with unaffected owners and tenants; (f) earnings of affected workers fell faster than unaffected workers. Therefore, land acquisition resulted in substantial economic hardship for large sections of the rural population, for many of whom compensation offered was inadequate.

Local Democracy and Clientelism: Implications for Political Stability in Rural West Bengal

This paper examines factors underlying the unusual stability of political power in rural West Bengal, using data pertaining to the functioning of local democracy from a household survey conducted by the authors during 2003-05. It examines patterns of political awareness, participation, distribution of benefits by gram panchayats, and voting across households of varying socio-economic characteristics. The main findings are that (i) political participation was high on average; (ii) within villages panchayat benefits flowed to poor and scheduled caste/scheduled tribe groups on par or better, compared with the rest of the population; (iii) distribution of benefits across villages was biased against those with more landless households; and (iv) the lasting political success of the Left owed partly to a clientelist relationship of the party with the voters, and partly to the gratitude of voters of low socio-economic status arising out of broad-based changes.

Is There Too Little Theory in Development Economics Today?

Is There Too Little Theory in Development Economics Today?
DILIP MOOKHERJEE Development economics is increasingly becoming an empirical discipline today. Where theory reigned during the 1980s and early 1990s, in the last 10 years or so the primary research concerns have become increasingly driven by empirical and policy issues. In this essay I wish to reflect on the balance between theory and the rest in the discipline, thinking aloud about the question of whether the pendulum has shifted away a bit too far, and whether there is need for some reorientation of the dominant research agenda or methodology.

Poverty Alleviation Efforts of Panchayats in West Bengal

This paper examines poverty alleviation efforts of West Bengal panchayats, comprising implementation of land reforms and pro-poor targeting of credit, agricultural minikits, employment programmes and fiscal grants. The sample includes 89 villages and covers four successive panchayat administrations. While average levels of poverty alleviation efforts were high, there were significant variations both across and within villages over time. Poverty alleviation efforts within villages improved when land was distributed more equally, the poor became more literate, there were fewer low caste households and local elections were more contested.

Dissection of a Bold Budget

Arindam Das-Gupta Dilip Mookherjee Barring adverse harvests or oil price movements, the 1993-94 budget is likely to increase the industrial growth rate, without significantly increasing inflation. The balance of payments situation may, however, deteriorate, resulting in downward pressure on the rupee, necessitating intervention by the RBI to stabilise the exchange rate The resource mobilisation assumptions underlying the budget projections for 1993-94 appear to be slightly optimistic. Never- the less, the likely increases in customs and excise revenues and direct tax receipts should cover the effects of the duty concessions. There is some uncertainty, however, about the ability of public enterprises to raise enough resources through market borrowings to implement plan outlays. In terms of the aim of longer term structural adjustment, the fiscal policy of the government appears to be successful in reducing government borrowing, but unsuccessful in stepping up investments, particularly in infrastructure. Detailed aspects of tax policy are appraised and some suggestions for administrative initiatives and for insurance market reform are offered.

Indian Economy at the Crossroads

Indian Economy at the Crossroads Dilip Mookherjee The government's economic reform programme adheres to an orthodox pattern associated with the IMF, the World Bank, and the mainstream western macroeconomic profession. The orthodoxy claims to be based on the experience of a large number of developing countries in pursuing similar adjustment programmes over the last two decades, and on the conviction that these experiences carry some common lessons for most other developing countries. On the other hand, crities question the orthodox analysis on various counts' and believe that unique features of the Indian economy render invalid most of its 'lessons' The author briefly reviews, in Section II of this paper, the reasoning employed for and against the typical structural adjustment programme. Section III examines some macroeconomic data pertaining to the Indian economic crisis, with a view to identifying the underlying factors. Section IV then goes on to appraise some of the broad policy initiatives chosen by the government since the summer of 1991.

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