P.V. Srinivasan

Widowhood and poverty in rural India: Some inferences from household survey data

This paper examines the relationship between widowhood and poverty in rural India, based on National Sample Survey data on consumer expenditure. In terms of standard poverty indices based on household per-capita expenditure, there is no evidence of widows being disproportionately concentrated in poor households, or of female-headed households being poorer than male-headed households. These findings also apply in terms of adult-equivalent consumption, for any reasonable choice of equivalence scales. Poverty indices for different household types, however, are quite sensitive to the level of economies of scale in household consumption. Even relatively small economies of scale imply that the incidence of poverty among single widows, living with unmarried children, and female household heads (all of whom tend to live in relatively small households) is higher than in the population as a whole.

Geographical targeting of poverty alleviation programs: methodology and applications in rural India

The paper presents a methodology for mapping poverty within national borders at the level of relatively small geographical areas and illustrates this methodology for India. Poverty alleviation programs in India are presently targeted only at the level of the state. All states includes, however, many non-poor households, whereas many poor households who live in states that have not been selected for the targeted programs are left out. The paper applies the methodology for mapping poverty at the level of districts in India, thus increasing the target areas from the 24 states (with over 40 million people in each) to 466 districts (with only around 2 million people in each).

Liberalized trade and domestic price stability. The case of rice and wheat in India

Abstract This paper analyzes the effects of liberalizing foodgrain trade on domestic price stability using a multi-market equilibrium model in which the direction of trade is determined endogenously and world prices are sensitive to the amount traded by India. Simulation results demonstrate that contrary to popular belief, freeing of trade by India leads to greater domestic price stability even though world prices are more volatile. Freeing of trade by India also leads to higher world price stability. Under liberalized trade, variable levies/subsidies are more effective in stabilizing domestic prices compared to buffer stocks. It is therefore in Indias interest to argue for non-zero binding on import tariffs and export subsidies at the WTO negotiations.

Grain price stabilization in India: Evaluation of policy alternatives

Stabilization of prices is an important element of food policy in India as in most other countries - both developing and developed. However, since the magnitude of grain stocks held for this purpose as well as the costs of physical storage have become prohibitively high, there is now a need for finding cost-effective alternatives including non-interventionist and marketoriented methods for price stabilization. In this paper we consider the case of rice and wheat which are staple foodgrains in India. We make a comparison between alternative price stabilization policies including that of holding buffer stocks in terms of their impact on domestic price stability, producer and consumer welfare and government costs. A multi-market equilibrium framework is used where private storage, consumption, supply and prices of rice and wheat are determined simultaneously. Indian exports and imports are assumed to affect world prices. The alternative price stabilizing mechanisms are ranked according to both the criteria, welfare and price stability achieved. The main findings are as follows. The ranking of alternatives varies with the criterion used. Greater price stability need not necessalily imply greater welfare. The option of variable levies on private external trade turns out to be the most inexpensive and that of domestic buffer stocks the costliest in achieving price stability. Further, the efficacy of buffer stocks and subsidy to plivate storage in stabilizing prices is lower under free trade as compared to the case where the economy is closed to private external trade.

Food inventory policies under liberalized trade

Abstract This paper evaluates the role of food inventories or buffer stocks in stabilizing prices of foodgrains in India when private external trade in grain is liberalized. The model adopts a multi-market equilibrium framework with the direction of trade determined endogenously. World prices are assumed to be sensitive to the amount traded by India (the ‘large country’ effect). The simulation results demonstrate that holding foodgrain inventories is an inefficient mechanism for stabilizing domestic prices under liberalized trade. Variable levies/ subsidies on trade appear to be more cost effective. Freeing of trade lowers domestic price variability even though world prices are more volatile.

Foodgrain price stabilization: Implications of private storage and subsidized food distribution

Abstract Through simulation exercises, this paper explores the implications of private storage and subsidized distribution of foodgrain for price stabilization policies in India. A multi-market equilibrium approach is used to incorporate the simultaneity in the determination of supply and demand for the three major cereals, namely, rice, wheat, and coarse cereals. The policy implications of the results obtained are relevant to the current debate on agricultural policy reforms in India.

Globalization and public agricultural research in India.

Summary and Concluding Remarks This chapter examined the impact of globalization on the agricultural sector of India ingeneral and on the Indian agricultural research system in particular. It also identifiedvarious options and strategies that may be used to meet the challenges posed byglobalization. Economic reforms aimed at fiscal stabilization led to decreased publicspending on agricultural research and extension, irrigation, and rural development.The resulting negative effect on the agricultural growth rates was partly offset byefficiency gains as an effect of trade liberalization measures. Institutional, trade, andprice policy reforms, together with improvements in the public sector’s managementof infrastructure facilities such as irrigation, power, and roads, can further increase theefficiency of agricultural production. The decline in public investments in theagriculturalsectorislikely,however,toaffectpoorfarmersdisproportionately.Unlikeresource-rich farmers who can compensate for the fall in public investments by raisingtheir private investments thanks to incentives provided by the more favorableconditions created by deregulation measures, the credit-constrained, small, andmarginal farmers cannot make such investments.While the fiscal adjustments reduced the total value of public funds allocated toagricultural research, they also necessitated reforms in the distribution of availablefunds across competing needs, taking into account the policy concerns and issuesbrought up by the globalization process. The public agricultural research system isresponding to these needs by establishing new priorities for its resource allocation andby encouraging private-sector participation with adequate supervision and regulation.Moreover, the growing commercialization of agricultural research, as an effect oftrade liberalization, deregulation, and the introduction of IPR, provides an opportunityfor public research organizations to make up for the deficits in their budget outlays bysellingresearchproductsandservices.Theintroductionofamatchinggrantschemebythe government for revenues commercially earned by ICAR can precipitate thisprocess.Toenhancetheimpactandeffectivenessofpublicresearch,thereis,however,a need to take advantage of potential complementaries between public and privateresearch through collaboration or the joint funding of research projects. Publicresearch projects can be contracted out to private research companies, and publicresearch services can be provided to, and funded by the private sector.ButasthepilotsurveyamongselectedNARIsinIndiaindicates,theinstituteshavenot changed many of their research goals as a result of policy reforms. The sample ofresearch projects currently undertaken in the NARIs does not show a decreasedimportance of the primary traditional goals of agricultural R&D: self-sufficiency inproduction and raising farmers’ income. There is no significant increase in theemphasis of goals such as the promotion of exports. It may therefore be left to theprivate sector to take up the research needs of agricultural exports. The government ofIndia plays a significant role in agricultural R&D through funding provided to theNARS (this includes ICAR as well as, for example, universities). Moreover,government ministries and researchers in the NARS appear to have the decisiveinfluence in setting the research priorities of the public agricultural research institutes,and most research projects appear to be supply-driven.

Food price inflation, growth and poverty

The global population is forecasted to reach 9.4 billion by 2050, with much of this increase concentrated in developing regions and cities. Ensuring adequate food and nourishment to this large population is a pressing economic, moral and even security challenge and requires research (and action) from a multi-disciplinary perspective. This book provides the first such integrated approach to tackling this problem by addressing the multiplicity of challenges posed by rising global population, diet diversification and urbanization in developing countries and climate change.

Optimal administered pricing under capacity constraints

Abstract This paper addresses the question of how pricing policies can improve the utilization of existing production capacities. An optimizing input-output model for the Indian economy is developed for this purpose where the governments objective is to maximize growth subject to capacity constraints. It is found that the optimal prices are related to the Keynesian income multipliers associated with increases in the consumption of goods.