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Linkages between government spending, growth, and poverty in rural India:

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  • Fan, Shenggen
  • Hazell, P. B. R.
  • Thorat, Sukhadeo

Abstract

"This research report on India addresses an important policy issue faced by policy-makers in many developing countries: how to allocate public funds more efficiently in order to achieve both growth and poverty-reduction goals in rural areas. This research is particularly important at a time when many developing countries are undergoing substantial budget cuts as part of macroeconomic reforms and adjustment. The econometric model employed in this research includes a broad range of government expenditure items. It traces their effects on productivity growth and poverty alleviation and ranks them, exploring the potential trade-offs and complementarities of the two goals. Of the various investments weighed, the report finds that investments in rural roads and agricultural research and development have the greatest impact, while government spending specifically targeted to poverty reduction such as rural development and employment pro rams have only modest effects. In the light of these results, many developing countries may want to take a second look at their policies for poverty reduction and growth." (Forward by Per Pinstrup-Andersen)

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Bibliographic Info

Paper provided by International Food Policy Research Institute (IFPRI) in its series Research reports with number 110.

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Date of creation: 1999
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Handle: RePEc:fpr:resrep:110

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Keywords: Rural poor India.; Economic assistance; Domestic India.; Public investments India.; Government spending policy India.; Economic development; Poverty India.;

References

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  1. Fan, Shenggen, 1997. "Production and productivity growth in Chinese agriculture: new measurement and evidence," Food Policy, Elsevier, vol. 22(3), pages 213-228, June.
  2. Binswanger, Hans P. & Khandker, Shahidur R. & Rosenzweig, Mark R., 1993. "How infrastructure and financial institutions affect agricultural output and investment in India," Journal of Development Economics, Elsevier, vol. 41(2), pages 337-366, August.
  3. Otsuka, Keijiro & Chuma, Hiroyuki & Hayami, Yujiro, 1993. "Permanent Labour and Land Tenancy Contracts in Agrarian Economies: An Integrated Analysis," Economica, London School of Economics and Political Science, vol. 60(237), pages 57-77, February.
  4. Bell, Clive & Rich, Robert, 1994. "Rural Poverty and Aggregate Agricultural Performance in Post-independence India," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 56(2), pages 111-33, May.
  5. L. R. Jain & Suresh D. Tendulkar, 1990. "Role of Growth and Distribution in the Observed Change in Headcount Ratio Measure of Poverty: A Decomposition Exercise for India," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 25(2), pages 165-205, July.
  6. Ghose, A K, 1989. "Rural Poverty and Relative Prices in India," Cambridge Journal of Economics, Oxford University Press, vol. 13(2), pages 307-31, June.
  7. Hazell, Peter B. & Haggblade, Steven, 1990. "Rural - urban growth linkages in India," Policy Research Working Paper Series 430, The World Bank.
  8. Ravallion, Martin & Datt, Gaurav, 1995. "Growth and poverty in rural India," Policy Research Working Paper Series 1405, The World Bank.
  9. Datt, Gaurav & Ravallion, Martin, 1997. "Why have some Indian states performed better than others at reducing rural poverty?," FCND discussion papers 26, International Food Policy Research Institute (IFPRI).
  10. Griffin, Keith & Ghose, Ajit Kumar, 1979. "Growth and impoverishment in the rural areas of Asia," World Development, Elsevier, vol. 7(4-5), pages 361-383.
  11. Evenson, Robert E. & Pray, Carl E. & Rosegrant, Mark W., 1999. "Agricultural research and productivity growth in India:," Research reports 109, International Food Policy Research Institute (IFPRI).
  12. Bhagwati, Jagdish N., 1988. "Poverty and public policy," World Development, Elsevier, vol. 16(5), pages 539-555, May.
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