Topics
National Income and Related Aggregates
- Macroeconomics Vs Microeconomics
- Representative Goods and Sectors
- Macroeconomic Agents and Government Role
- Emergence of Macroeconomics
- Context of the Present Book of Macroeconomics
- 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
Introductory Macroeconomics
Introduction
- A Simple Economy
- Central Problems of an Economy
- Concepts of Production Possibility Frontier
- Organisation of Economic Activities
- Positive and Normative Economics
- Macroeconomics Vs Microeconomics
Development Experience (1947-90) and Economic Reforms since 1991
- India's Economy Before 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
- Post-Independence Economic Systems and Planning
- Five Year Plans (FYP)
- Agriculture
- Industry and Trade
- Trade Policy: Import Substitution
- The 1991 Economic Crisis and Reforms
- Background of the New Economic Policy
- Liberalisation
- Privatisation
- Globalisation
- World Trade Organisation (WTO)
- Impact of the Economic Reforms
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
- Narrow and Broad Money
- Demonetisation
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
Indian Economic Development
Current Challenges Facing Indian Economy
- Concept of Human Capital
- Sources of Human Capital
- Human Capital and Economic Growth
- Human Capital and Human Development
- State of Human Capital Formation in India
- Growth of Education Sector in India
- Challenges and Future Prospects in Education
- Rural Development in India
- Credit and Marketing in Rural Areas
- Agricultural Market System
- Diversification into Productive Activities
- Sustainable Development and Organic Farming
- 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
- Environment and Sustainable Development in India
- State of India’s Environment
- Concept of Sustainable Development
- Strategies for Sustainable Development
Development Experience of India – a Comparison with Neighbours
Determination of Income and Employment
- Aggregate Demand and Its Components
- Consumption
- 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
Introductory Microeconomics
Production and Costs
- Production Function
- Concept of Production
- Some Basic Concepts - Total, Average and Marginal Physical Products
- Relation Between Total, Average and Marginal Product
- Law of Variable Proportions
- Average and Marginal Physical Products
- Changes in Production
- Fixed Cost and Variable Cost
- Behaviour of Cost in the Short - Run
- Relationship Between Average Variable Cost and Average Total Cost and Marginal Cost
- Opportunity Cost
- Revenue Concepts
- Producer's Equilibrium
- Law of Supply
- Supply Schedule
- Distinction Between Supply and Stock
- Determinants of Supply
- Movement Along the Supply Curve Or Expansion and Contraction of Supply
- Measurement of Elasticity of Supply > Percentage Method
- Methods of Measurement of National Income
- Marginal Cost (MC)
- The Law of Diminishing Marginal Product
- Shapes of Product Curves
- Costs in Long Run Period
- Returns to Scale
Government Budget and the Economy
The Theory of the Firm Under Perfect Competition
- Concept of Market
- Market Equilibrium
- Determination of Market Equilibrium
- Effects of Changes (Shifts) in Demand on Equilibrium Price and Equilibrium Quantity
- Perfect Competition
- Imperfect Competition
- Factors Determining Market Forms
- 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
- Supply Schedule
- Price Elasticity of Supply
Balance of Payments
- 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
Market Equilibrium
- Simple Monopoly in the Commodity Market
- Other Non - Perfectly Competitive Markets
Estimated time: 15 minutes
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Introduction
- India, Pakistan and China began their developmental path around the same time.
- India and Pakistan became independent in 1947; People’s Republic of China was established in 1949.
- All three countries adopted planning through Five Year Plans.
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Common Planning Approach
- India: First Five Year Plan, 1951–56; followed Five Year Plans till March 2017.
- Pakistan: First Five Year Plan (Medium Term Development Plan) started in 1956; currently 12th Plan (2018–23).
- China: First Five Year Plan started in 1953; currently 14th Plan (2021–25).
- India and Pakistan adopted similar strategies of large public sector and higher social sector expenditure.
- Till the 1980s, all three had similar growth rates and per capita incomes.
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China’s Developmental Path
- One-party rule brought critical sectors, enterprises and individual lands under government control.
- Great Leap Forward (GLF) campaign, 1958, aimed at massive industrialisation with backyard industries.
- Rural communes were created for collective cultivation; about 26,000 communes existed in 1958.
- GLF faced problems: severe drought killing about 30 million people and withdrawal of Russian professionals.
- Great Proletarian Cultural Revolution (1966–76) sent students and professionals to the countryside.
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China’s Economic Reforms (since 1978)
- Reforms introduced in phases, starting with agriculture, foreign trade and investment.
- Commune lands were divided into small plots for household use, not ownership.
- Households kept all income after paying stipulated taxes.
- Later, private sector firms and township/village enterprises were allowed to produce goods.
- State Owned Enterprises faced competition.
- Dual pricing introduced: part of output at government-fixed prices, remaining at market prices.
- As production rose, the share of market transactions increased.
- Special economic zones were set up to attract foreign investors.
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Pakistan’s Developmental Path
- Pakistan follows a mixed economy with public and private sectors.
- Late 1950s–1960s: regulated import substitution-based industrialisation with tariff protection and import controls.
- Green Revolution led to mechanisation, higher public infrastructure investment and increased foodgrain output.
- Agrarian structure changed significantly.
- 1970s: capital goods industries were nationalised.
- Late 1970s–1980s: policy shifted towards denationalisation and encouragement of private sector.
- Pakistan received financial support from western nations and remittances from emigrants to the Middle-east.
- These factors stimulated economic growth and created a climate for new investments.
- Reforms were initiated in 1988.
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Key Points: Developmental Path – A Snapshot View
- All three countries started development around the same time under planned economic strategies.
- India and Pakistan had similar public-sector-led, social-expenditure-focused approaches and similar growth till the 1980s.
- China’s early development involved GLF, communes, drought and the Cultural Revolution.
- Post-1978, China adopted phased reforms, dual pricing and special economic zones.
- Pakistan moved from regulated import substitution and nationalisation to denationalisation, private sector promotion and reforms supported by external finance and remittances.
Test Yourself
Related QuestionsVIEW ALL [32]
From the set of the events given in column I and corresponding facts given in Column II, choose the correct pair of statements:
| COLUMN I | COLUMN II | ||
| i | Dual Pricing | A | Economic Reforms of 1991 |
| ii | Setting up of Special Economic Zones in China | B | To attract foreign Direct Investment |
| iii | Commune System | C | Backyard based Industrial production units |
| iv | Great Proletarian Cultural Revolution | D | Collective Farming |
