Growth, Inequality, and Poverty: Prospects for Pro-Poor Economic Development

By Anthony Shorrocks; Rolph Van Der Hoeven | Go to book overview

9 Twin Peaks: Distribution Dynamics of Economic Growth across Indian States

SANGHAMITRA BANDYOPADHYAY


9.1 INTRODUCTION

There are few questions more compelling to economists than to explain why some countries grow faster than others. Understanding different patterns of cross-county or cross-regional growth is important—persistent disparities in income across countries and across regions lead to wide disparities in welfare and is often a source of social and political tension, particularly so within national boundaries. The existence of regional inequalities of incomes across Indian states has been well documented. It is well known that western states are industrially advanced, while the northwest is agriculturally prosperous. There are pockets of relative success in agriculture and industry in the south and the north, while the northeastern states are yet to excel in either.

Recording that regional inequalities exist is just the starting point; what is of concern is that they continue to persist even after five decades of concerted state-led planning. Such differential development, given widespread interstate socioethnic and political differences, risks unleashing highly destructive centrifugal political forces. It is, therefore, vitally important that policies for containing and counteracting regional disparities are implemented in the early rapid phase of development.

This study documents the dynamics of growth and convergence of real per capita incomes across Indian states over the period 1965-97, and attempts to find some factors underpinning such income dynamics. There are a number of specific goals. First, we are interested in the dynamics of equality of incomes across Indian states. In other words, is there any tendency towards equality in the cross section income distribution across the Indian states? If not, what distribution pattern do they exhibit?

Second, if cohesive tendencies are not obtained, we would like to characterize the possibilities for inter-regional mobility: are there any signs of poorer regions overtaking

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Growth, Inequality, and Poverty: Prospects for Pro-Poor Economic Development
Table of contents

Table of contents

  • Unu World Institute for Development Economics Research (Unu/Wider) ii
  • Growth, Inequality, and Poverty iii
  • Contents v
  • List of Figures vii
  • List of Tables ix
  • List of Acronyms and Abbreviations xi
  • List of Contributors xiii
  • Acknowledgements xvi
  • Introduction 1
  • References 12
  • 1: Economic Policy, Distribution, and Poverty 13
  • References 28
  • Appendix 57
  • References 59
  • 3: Growth, Inequality, and Poverty 62
  • 4: The Growth Elasticity of Poverty 81
  • Appendix 102
  • References 105
  • 6: Growth, Distribution, and Poverty Reduction 107
  • References 123
  • Appendix: Method and Sources 149
  • References 151
  • References 175
  • 9: Twin Peaks 176
  • 9.6 Conclusion 194
  • 10: A Decomposition of Inequality and Poverty Changes in the Context of Macroeconomic Adjustment 197
  • References 220
  • References 249
  • References 271
  • Index 277
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