Madhusudan Ghosh

Spatial Integration of Wheat Markets in India: Evidence from Cointegration Tests

Using the maximum likelihood method of cointegration, this paper empirically evaluates intra-state and inter-state spatial integration of wheat markets in India. The cointegration tests provide strong evidence in favour of spatial integration of the regional wheat markets. Even though the regional markets are geographically dispersed, the prices across different market centres within and across the selected states have exhibited long-run spatial linkages, suggesting that all the exchange locations are integrated and the prices provide relevant market signals. There are several implications of these results for agricultural price policy and food market liberalization programmes.

Economic Reforms, Growth and Regional Divergence in India

This paper examines long-run growth performance and regional divergence in per capita income across 15 major Indian states during the pre- and post-reform periods. Evidence shows that the divergence has increased the post-reform period. The divergence has been due to inter-state variations in production structures, human capital and infrastructure. Larger public investment in human capital and infrastructure for states with lower steady-state could improve overall growth performance and reduce regional imbalances. Ongoing economic reforms that seem to have led to an increase in growth as well as regional disparities of income need to be modified appropriately.

How Integrated is the Indian Wheat Market

Abstract Applying the momentum-threshold autoregressive (M-TAR) model due to Enders and Granger (Enders, W. and Granger, C.W.J. (1998) Unit root tests and asymmetric adjustment with an example using the term structure of interest rates. Journal of Business and Economic Statistics, 16(3), pp. 304–311), this article examines the relationship between the various prices of wheat quoted at different market centres in four Indian states. We find evidence of M-TAR asymmetric adjustments of wheat prices, indicating that price signals within states are transmitted over time in an asymmetric manner. This type of price adjusting behaviour is consistent as to how price differentials may respond to poor dissemination of knowledge regarding market conditions and high transactions costs. The results offer important policy implications.

Regional Economic Growth and Inequality in India during the Pre- and Post-reform Periods

Abstract This paper evaluates the economic performance of 15 major states in India, and examines whether initially disparate states displayed any tendency towards convergence in real per capita income during the period 1960/61–2006/07. Though the growth performance of the states has improved in the post-reform period, since 1991 the states have diverged in per capita income. The states following different steady-state paths are classified into three clubs—one convergent and two non-convergent. The regional divergence and club convergence are explained in terms of interstate variations in physical and social infrastructures, state-level policy reforms, foreign direct investment flows and economic structure. The poorly performing states could improve their relative economic position by undertaking investments in physical and social infrastructures, and speeding up the reform process by liberalizing investment and infrastructure policies. As industry and services are the major sources of regional divergence, any effort to reduce regional imbalance must focus primarily on these two sectors.

Regional Disparities in Education, Health and Human Development in India

This paper evaluates the relative performance of fifteen major Indian states on the issues of education, health and human development. It examines the regional disparities in human development and their association with per capita income and per capita social sector expenditure. The results show regional convergence in human development despite a divergence in real per capita income, indicating that the poor states, which have failed to catch up with the rich ones in terms of per capita income, have, however, managed to catch up in terms of human development. Female literacy is found to have a significant impact on human development. The effects of the per capita social sector expenditure on human development are found to be stronger than those of per capita income, suggesting that the strategy for improving various dimensions of human development by increasing the per capita government expenditure on social services would be more effective than the automatic improvement in human development resulting from the growth in per capita income.

Spatial Price Linkages in Regional Food Grain Markets in India

This paper examines spatial integration of food grain markets in India. Using the maximum likelihood method of cointegration, it investigates whether regional food grain markets within and across states are spatially linked or not. The cointegration tests provide evidence in favour of spatial integration of the regional food grain markets. Even though regional markets are geographically dispersed, prices across different market centres within and across states have exhibited long-run spatial linkages, suggesting that all the exchange locations are integrated and that prices provide relevant market signals. There are, however, regional variations in the extent of market integration, which could be due to regional disparities in infrastructure and the institutional structure of food grain markets. The results have important implications for agricultural price policy and the food market liberalisation programme.

Agrarian structure and rural poverty in India

Abstract The article examines the effects of agricultural development, agrarian structure and some related variables on rural poverty in India. The results while asserting the existence of trickle-down process, indicate its limited and declining power. Moreover, the process of marginalisation and proletarianisation of the peasantry and inequality in the distribution of land have poverty-aggravating effects. The study underlines the needs for increasing productive employment with real wages sufficient to maintain basic needs for sustainable reduction in rural poverty. It also suggests that an increase in the average size of the marginal and small holdings through appropriate land reforms would be poverty alleviating.

Dynamics of Agricultural Development and Rural Poverty in Indian States

This paper examines the inclusiveness of growth in agriculture and the dynamics of change and inter-state variation in rural poverty in India between 1972–73 and 2004–05. The incidence of and regional variations in rural poverty increased significantly, immediately after economic reforms. Variations in rural poverty have been associated with variations in consumption, inequality, agricultural performance and agrarian structure. The benefits of growth in agriculture seem to have trickled down to the rural poor, but the strength of the trickle-down process and the inclusiveness of growth have been limited and are weakening with time. The regressive features of the agrarian structure and the process of marginalisation and proletarianisation of the peasantry seem to have aggravated rural poverty. The results offer important policy implications for the alleviation of rural poverty.

Regional Economic Growth and Inequality

This chapter evaluates the economic performance of 15 major states in India and examines whether initially disparate states display any tendency towards convergence in real per capita income during the period 1960/1961–2006/2007. Though the growth performance of the states has improved in the post-reform period since 1991, the states have diverged in per capita income. The states following different steady-state paths are classified into three clubs—one convergent and two non-convergent. The regional divergence and club convergence are explained in terms of interstate variations in physical and social infrastructures, state-level policy reforms, foreign direct investment flows and economic structure. The poorly performing states could improve their relative economic position by undertaking investments in physical and social infrastructures and speeding up the reform process by liberalising investment and infrastructure policies. As industry and services are the major sources of regional divergence, any effort to reduce regional imbalance must focus primarily on these two sectors.

Liberalization, Growth and Regional Disparities in India

Chapter1: Introduction.- Chapter 2: Review of Economic Policies and Growth Performance.- Chapter 3: Regional Economic Growth and Inequality.- Chapter 4: Growth and Regional Divergence in Industry and Services.- Chapter 5: Growth and Regional Divergence in Agriculture.- Chapter 6: Structural Breaks and Performance in Agriculture.- Chapter 7: Growth and Structural Breaks in Food Grains Production.- Chapter 8: Spatial Efficiency in Regional Food Grain Markets.- Chapter 9: Inclusive Growth, Employment and Rural Poverty.- Chapter 10: Microfinance and Rural Poverty.- Chapter 11: Regional Disparities in Education, Health and Human Development.