Economic growth

The impact of inequality in hindering social outcomes is discussed. Although it may appear on the basis of limited data, in the Indian context, that growth alone is the main driver in improving social outcomes, including poverty reduction; and that increased inequality that is a by-product of the Indian non-inclusive growth process does not hinder social development, such a conclusion advanced recently in the Economic Survey 2020–21 is based on possibly insufficient analysis of the data. It is demonstrated that the apparent favourable association, which is counter-intuitive, between income inequality measures and social outcomes, is possibly due to both being associated with growth and could therefore be revealing a spurious relationship when considered in isolation.

Class and Conflict: Revisiting Pranab Bardhan’s Political Economy of India edited by Elizabeth Chatterjee and Matthew McCartney, New Delhi: Oxford University Press, 2020; pp x + 299, £47.99 (hb).

Growth has consistently remained a central topic in economic policy considerations of the government in India. However, there has also been a more scholarly interest in it among social scientists. As a part of the latter tradition, this paper addresses the proper delineation of the phases of growth in India, a matter of some discussion in the literature. Using state-of-the-art statistical methodology, it first establishes the trajectory of growth and then provides a theoretical explanation for that history. With data spanning the period 1950–2020, the procedure adopted is also able to assess the impact on economic growth of the policies of the present government. The results are conclusive. First, it is established that growth in India has accelerated continuously since the 1950s, implying that dynamism in the economy did not have to wait for the liberalising reforms launched in 1991. Next, the performance of India’s economy is compared to growth that has taken place in the rest of the world. It is seen that while India’s economy has, in recent years, shown a dynamism relative to the rest of the world, it has consistently fallen behind its most dynamic regions, notably in East Asia.

The two features of structural transformation visible in India are an increase in the overall gross domestic product and per capita incomes, enabled by the shift away from agriculture to other sectors or occupations with higher productivity; and greater urbanisation. An attempt is made to examine the emergence of small towns or urbanised villages in Gujarat and Rajasthan. The states depict a disparate pattern of rural economic transformation and varying levels of urbanisation. The emerging urban hierarchy is contextualised within the process of economic growth and transition, and the composition of urban growth along with the locational features of the emerging towns are studied. The underlying causes responsible for the nature of urban growth in the two states highlight the need for a regional focus of policy.

Resurgent Asia: Diversity in Development by Deepak Nayyar, New Delhi: Oxford University Press, 2019; pp xx + 295, ₹ 895.

Asian Transformations: An Inquiry into the Development of Nations edited by Deepak Nayyar, Oxford: Oxford University Press, 2019; pp xxiv + 577, price not indicated.

Asia’s Journey to Prosperity: Policy, Market, and Technology Over 50 Years by Asian Development Bank, Manila: ADB, 2020 (ebook), http://dx.doi.org/10.22617/TCS190290.