Why Poverty Persists in India: A Framework for Understanding the Indian Economy

by Mukesh Eswaran and Ashok Kotwal

After fifty years of development, mass poverty still persists in India. This analysis attempts to bring out how various sectors of the economy impinge on the development process. The authors show that two key features to the elimination of poverty in India are transferring labor from agriculture to industry and growth in agricultural productivity. They argue that industrial progress cannot benefit the poor in the absence of progress in the agricultural...

• Format: Paperback
• Language: English
• ISBN: 0195632389
• ISBN13: 9780195632385
• Release Date: June 1994
• Publisher: Oxford University Press, USA
• Length: 136 Pages
• Weight: 0.35 lbs.
• Dimensions: 0.3" x 5.6" x 8.6"

Customer Reviews

Simple Models, Profound Ideas

This book uses simple, non-mathematical economic models to analyze poverty in India. The authors' basic idea is that reducing India's high labor/land ratio is the only way to raise living standards for hundreds of millions of Indians who live below the poverty line. Along the way, the authors give incredibly clear explanations of basic economic concepts like marginal product, general equilibrium, and comparative advantage. They also use their models to provide a fascinating explanation of why free trade with Britain probably increased poverty in India in the 18th and 19th centuries. I gave the book four stars instead of five only because the discussion of contemporary policy issues is dated and overly-anecdotal. Otherwise, this book is a small gem of exposition and analysis. If only all economists wrote this well.