Human Face of Development Spending: A Study Across Indian States

It is always assumed that development spending acts as a potentially powerful instrument for fighting poverty, improving health conditions, and promoting literacy and quality education among masses. Thus, it helps in bringing about improvement in the social and human development index of a nation or its states. In this backdrop, this paper makes an attempt to examine the pattern and synchronization of evidence of aggregate social and economic service sector spending, and the effect of development spending on social and human development across the states. It was observed that development spending has exerted differential impact on social and human development across the states. However, it is found to be more effective in the states with lower values of human development. In these states, investment on social and economic services helps more in bringing about a higher degree of human development than that of the GSDP. It is therefore suggested that lower the social and human development, more effective is the state-sponsored development spending, and thereby greater scope for bringing about improvement in social and human development index in that state. One possible explanation would be that lower the degree of social and human development of a state, more room for improvement could be brought by the social and development spending and hence the larger impact.