Topics
Introduction
- A Simple Economy
- Central Problems of an Economy
- Concepts of Production Possibility Frontier
- Organisation of Economic Activities
- Positive and Normative Economics
- Microeconomics and Macroeconomics
Introductory Macroeconomics
Introduction
- How Macroeconomics Differs from Microeconomics
- Representative Goods and Sectors
- Macroeconomic Agents and Government Role
- Emergence of Macroeconomics
- Context of the Present Book of Macroeconomics
Indian Economy on the Eve of Independence
- Introduction to Indian Economy on the Eve of Independence
- Low Level of Economic Development Under the Colonial Rule
- Agricultural Sector in India
- Industrial Sector
- Foreign Trade of India
- Demographic Condition
- Occupational Structure
- Infrastructure
National Income Accounting
- Meaning of Economic Wealth and Final Goods
- Stocks, Flows, and Depreciation
- Capital Formation, Trade-off & Circular Flow of Income
- Circular Flow of Income and Methods of Calculating National Income
- Output Method/Product Method
- Expenditure Method
- Income Method
- Factor Cost, Basic Prices and Market Prices
- Some Macroeconomic Identities
- National Disposable Income
- Private Income
- National Income Aggregates
- Real GDP and Nominal GDP
- GDP and Welfare
Indian Economy 1950-1990
Indian Economic Development
Theory of Consumer Behaviour
- Consumer Behaviour: The Problem of Choice
- Basic Concepts of Microeconomics > Utility
- Cardinal Approach (Utility Analysis)
- Derivation of Demand Curve in the Case of a Single Commodity
- Ordinal Utility Analysis/Indifference Curve Analysis
Production and Costs
- Production Function
- Basics of Production Theory
- Variation of Output in the Short-Run Returns to a Factor
- Relation Between Total, Average and Marginal Product
- Law of Variable Proportions
- Average and Marginal Physical Products
- Changes in Production
- Cost - Fixed Cost
- Cost -variable Cost
- Behaviour of Cost in the Short - Run
- Relationship Between Average Variable Cost and Average Total Cost and Marginal Cost
- Concept of Opportunity Cost
- Marginal Revenue
- Producer's Equilibrium
- Law of Supply
- Market Supply Schedule
- Distinguish between Stock and Supply
- Determinants of Supply
- Movements Along and Shifts in Supply Curve
- Measurement of Elasticity of Supply
- Methods of Measurement of National Income
- Cost Concepts > Marginal Cost
- The Law of Diminishing Marginal Product
- Shapes of Product Curves
- Costs in Long Run Period
- Returns to Scale
Money and Banking
- Concept of Money
- Functions of Money
- Demand for Money and Supply of Money
- Money Creation by Banking System
- Limits to Credit Creation and Money Multiplier
- Policy Tools To Control Money Supply
- Demand and Supply for Money : A Detailed Discussion
- The Transaction Motive
- The Speculative Motive
- Various Measures of Supply of Money
- Legal Definitions: Narrow and Broad Money
- Demonetisation
Liberalisation, Privatisation and Globalisation : An Appraisal
Introductory Microeconomics
Determination of Income and Employment
- Aggregate Demand and Its Components
- Consumption
- Consumption and Saving Propensities
- Investment
- Determination of Income in Two-sector Model
- Determination of Equilibrium Income in the Short Run
- Macroeconomic Equilibrium with Price Level Fixed
- Effect of an Autonomous Change in Aggregate Demand on Income and Output
- The Multiplier Mechanism
- Paradox of Thrift
- Equilibrium Output and Employment
The Theory of the Firm Under Perfect Competition
- Concept of Market
- Market Equilibrium
- Determination of Market Equilibrium
- Effect of Simultaneous change in Demand and Supply on Equilibrium Price
- Perfect Competition
- Imperfect Competition
- Classification of Market Structure
- Oligopoly
- Market Forms - Perfect Oligopoly
- Market Forms - Imperfect Oligopoly
- Equilibrium Price
- Applications of Tools of Demand and Supply Price Control
- Price Ceiling
- Price Floor
- Revenue Concepts
- Profit Maximisation Objective
- Determinants of a Firm’s Supply Curve
- Market Supply Schedule
- Price Elasticity of Supply
Human Capital Formation in India
Market Equilibrium
- Simple Monopoly in the Commodity Market
- Other Non - Perfectly Competitive Markets
Government Budget and the Economy
Rural Development
Employment: Growth, Informalisation and Other Issues
- The Nature and Importance of Work in Society
- Workers and Employment
- Participation of People in Employment
- Self-employed and Hired Workers
- Employment in Firms, Factories and Offices
- Growth and Changing Structure of Employment
- Informalisation of Indian Workforce
- Concept of Unemployment
- Government and Employment Generation
Open Economy Macroeconomics
- Open Economy and Its Linkages
- Concept of Balance of Payments
- Current Account
- Capital Account
- Balance of Payments Surplus and Deficit
- Foreign Exchange Market
- Foreign Exchange Rate
- Determination of the Exchange Rate
- Merits and Demerits of Flexible and Fixed Exchange Rate Systems
- Managed Floating Exchange Rate System
Environment and Sustainable Development
Comparative Development Experiences of India and Its Neighbours
- Comparative Development Strategies: India, China, and Pakistan
- Developmental Path - a Snapshot View
- Demographic Indicators
- Gross Domestic Product and Sectors
- Indicators of Human Development
- Development Strategies - an Appraisal
- Introduction
- Meaning
- Measures Taken for Privatisation
- Classification of Public Sector Units
- Need for Privatisation
- Privatization Process
- Advantages
- Real-Life Application
- Key Point Summary
Maharashtra State Board: Class 11
Introduction
Imagine an ST bus run by the Maharashtra government is facing losses and slow service, but in private hands, it now offers better service, new features, and on-time buses. Privatisation is when the government lets private companies handle such services or businesses.
Maharashtra State Board: Class 11
Meaning
Privatisation means transferring government-owned companies or assets (public sector) to private ownership or management. Put simply, it reduces government role and increases private business involvement in the economy. Imagine the government running a bakery but later selling shares or hiring private managers so businesspeople run it instead.
Privatisation
Maharashtra State Board: Class 11
Measures Taken for Privatisation
- Disinvestment:
The government sells shares in poorly performing public companies to private buyers.
Example: Maruti, ITDC hotels, VSNL. - Dereservation Policy:
Originally, 17 key industries (e.g., railways, atomic energy) were reserved for the public sector. Gradually, most were opened to private competition. Now, only railways and atomic energy remain reserved. - BIFR Establishment:
The Board of Industrial and Financial Reconstruction (BIFR) helps decide what to do with 'sick' public companies, guiding either their closure, sale, or rehabilitation. - National Renewal Board (NRB):
When unprofitable public units shut down, workers may lose jobs. The NRB provides financial help or retirement packages to affected employees. - Navratna Status:
'Navratnas' are top-performing public companies given greater independence. In 1997-98, nine companies like IOC, ONGC, and SAIL received this status, allowing quicker business decisions.
Maharashtra State Board: Class 11
Classification of Public Sector Units
| Category | Criteria | Examples |
|---|---|---|
| Miniratna I | Profitable for 3 yrs, ₹30+ crore profit in 1 year | Some PSUs from telecom and energy sectors |
| Miniratna II | Profitable for 3 yrs, positive net worth | Smaller government companies |
| Maharatna | Large CPSEs with global ambitions, major revenue | IOC, ONGC, NTPC |
Maharashtra State Board: Class 11
Need for Privatization
- More Efficiency: Private firms often deliver faster and better quality.
- Less Political Interference: Business decisions without political delays.
- Accountability: Private owners answer to customers and shareholders.
- Solve Labour Issues: Clearer rules for employees.
- Capital Market Discipline: More competition and better stock market participation.
- Reduce Government Burden: More funds for public services like education & health.
Maharashtra State Board: Class 11
Privatization Process
Maharashtra State Board: Class 11
Advantages
- Higher productivity and efficiency.
- Better customer service.
- More innovation and investment.
- The government earns money from sales.
- Focus on governance, not running businesses.
Maharashtra State Board: Class 11
Real-Life Application
| Company | Before Privatisation | After Privatisation |
|---|---|---|
| Air India | Govt-owned airline, losses | Tata Group takeover – service upgrade & cost control |
| Maruti Suzuki | Govt partnership | Now fully private, leading car brand |
| Hindustan Zinc | Govt loss-making unit | Profitable and globally competitive |
CBSE: Class 12
Maharashtra State Board: Class 11
Maharashtra State Board: Class 11
Key Points: Privatisation
- Privatisation refers to the transfer of a business from government to private ownership.
- It brings efficiency, accountability, better service, and profit focus.
- Indian examples include Air India, Maruti Suzuki, and Hindustan Zinc.
- Methods include disinvestment, outright sale, and private management contracts.
- Privatisation = government reduces or gives up ownership/management of public sector enterprises.
- Disinvestment = sale of government shares in PSUs to improve discipline, modernisation and efficiency using private capital and management.
- Aims: attract FDI and make PSUs more efficient by giving autonomy.
- Efficient PSUs get Maharatna / Navratna / Miniratna status for greater autonomy and global expansion.
