The problem of regional disparities in India.

摘要

Inter-state economic disparities in India are increasing. The evidence suggests stark differences not only in income and levels of output, but also ill the availability of basic infrastructure. For India, which is a diverse country, with many religion and languages, the divergence of states on economic grounds is a cause for concern. In this dissertation, we use Gunnar Myrdal's cumulative causation theory to examine the causes of the disparities in India. There are three objectives in this dissertation, first, to determine the movement of disparities in India. Second, to explain the disparities by examining the historical development of states in India. Third, to identify infrastructure variables that states can target to improve their output. With the help of different inequality measures and several variables, we have found that since 1947, the regional disparities have increased. This increase of disparities in India is a historical phenomenon. We study the policies of the British during their occupation of India. The states which were accorded preferential treatment by the British, prospered during the British rule. We also examine the policies adopted by the Indian government, under the Finance and Planning commissions. Here, we study the distribution mechanism and ascertain the equity of these distributions. The post independence evidence suggests that, the same estates that were growing during the British rule, are ranked as the most prosperous states in India. The overall distribution mechanism was found to be regressive, the richer states being accorded a larger share of the central transfers. This has contributed to the worsening of the inter-state disparities. Using econometric techniques, we then identify infrastructure variables that individual states can target, to improve their output. Finally, we discuss the implications of the liberalization program, adopted six years ago, on the regional development of India. Initial evidence suggests that the inter-state disparities are widening and the capital investments are primarily being channeled to the developed states. Thus it is important to evaluate the role of the government, private investment and development of states in India.