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On the sectoral linkages and pattern of economic growth in India

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  • Tarlok Singh

Abstract

This study examines the linkages between agriculture, industry, and services sectors, and analyses the pattern of economic growth in India. The vector autoregression model is estimated on annual data for the period 1950–1951 to 2009–2010. The results provide strong support for the long-run and a weak support for the short-run linkages among sectors. The development of rural sector is generally synonymous with the growth of agriculture and that of urban sector with the growth of manufacturing and services sectors. The services sector bypassed the successful completion of the process of industrialization, and prematurely emerged as the dominant driver and key lever of economic growth. The development strategy needs to be rebalanced to revitalize agriculture to generate rural employment, support industry, and provide the wage goods and food security. The revitalization of agriculture needs to be complemented by the development of highly productive and internationally competitive manufacturing sector to boost the manufacturing goods exports, stimulate the positive productivity spillovers, provide productive job opportunities to surplus labour in agriculture, generate urban employment, reduce underemployment and disguised unemployment in the informal sector of the urban economy, and accomplish the process of industrialization.

Suggested Citation

  • Tarlok Singh, 2016. "On the sectoral linkages and pattern of economic growth in India," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 21(2), pages 257-275, April.
  • Handle: RePEc:taf:rjapxx:v:21:y:2016:i:2:p:257-275
    DOI: 10.1080/13547860.2015.1094175
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    References listed on IDEAS

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    1. Rangarajan, C., 1982. "Agricultural growth and industrial performance in India:," Research reports 33, International Food Policy Research Institute (IFPRI).
    2. Elliott, Graham & Rothenberg, Thomas J & Stock, James H, 1996. "Efficient Tests for an Autoregressive Unit Root," Econometrica, Econometric Society, vol. 64(4), pages 813-836, July.
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    5. Tarlok Singh, 2012. "Does public capital crowd-out or crowd-in private capital in India?," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 15(2), pages 109-133.
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    11. Søren Johansen & Rocco Mosconi & Bent Nielsen, 2000. "Cointegration analysis in the presence of structural breaks in the deterministic trend," Econometrics Journal, Royal Economic Society, vol. 3(2), pages 216-249.
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    3. Yanling Jin & Yi Xu & Rui Li & Changping Zhao & Zhenghui Yuan, 2022. "Comprehensive Evaluation of China’s Input–Output Sector Status Based on the Entropy Weight-Social Network Analysis Method," Sustainability, MDPI, vol. 14(21), pages 1-25, November.

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