IDEAS home Printed from https://ideas.repec.org/a/unt/jnapdj/v20y2013i2p109-127.html
   My bibliography  Save this article

The interplay between growth and development: evidence from Indian districts

Author

Listed:
  • Jyoti Prasad Mukhopadhyay

    (corresponding author, PhD scholar, Institute for Financial Management Research (IFMR), 24 Kothari Road, Chennai, India)

  • Nilanjan Banik

    (Professor, Institute for Financial Management Research (IFMR), 24 Kothari Road, Chennai, India)

Abstract

In this paper we examine the nexus between growth and development using a recursive structural equation system which, to the best of our knowledge, has not been tried so far to examine such relationships in the Indian context. Another novel feature of our study is that we use district-level data to capture greater heterogeneity at a substate level. We use the growth rate of per capita income (PCI) as an indicator of economic growth, and the infant mortality rate (IMR) and literacy rate as the development outcomes. We find that IMR and literacy rate have a positive and statistically significant effect on the growth rate of PCI. Our results also show that the growth rate of PCI has a positive and statistically significant effect on IMR and the literacy rate. Further sensitivity analysis is performed to test the robustness of these findings.

Suggested Citation

  • Jyoti Prasad Mukhopadhyay & Nilanjan Banik, 2013. "The interplay between growth and development: evidence from Indian districts," Asia-Pacific Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 20(2), pages 109-127, December.
    • Handle: RePEc:unt:jnapdj:v:20:y:2013:i:2:p:109-127
    as

    Download full text from publisher

    File URL: http://www.unescap.org/sites/default/files/6-Part5-JyotiPrasad.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Angus S. Deaton & Christina Paxson, 2001. "Mortality, Education, Income, and Inequality among American Cohorts," NBER Chapters, in: Themes in the Economics of Aging, pages 129-170, National Bureau of Economic Research, Inc.
    2. Hanushek, Eric A. & Woessmann, Ludger, 2007. "The role of education quality for economic growth," Policy Research Working Paper Series 4122, The World Bank.
    3. Foster, Andrew D & Rosenzweig, Mark R, 1995. "Learning by Doing and Learning from Others: Human Capital and Technical Change in Agriculture," Journal of Political Economy, University of Chicago Press, vol. 103(6), pages 1176-1209, December.
    4. Strauss, John, 1986. "Does Better Nutrition Raise Farm Productivity?," Journal of Political Economy, University of Chicago Press, vol. 94(2), pages 297-320, April.
    5. T. S. Breusch & A. R. Pagan, 1980. "The Lagrange Multiplier Test and its Applications to Model Specification in Econometrics," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(1), pages 239-253.
    6. Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(2), pages 407-443.
    7. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    8. T. Paul Schultz, 1999. "Health and Schooling Investments in Africa," Journal of Economic Perspectives, American Economic Association, vol. 13(3), pages 67-88, Summer.
    9. Grossman, Michael, 1972. "On the Concept of Health Capital and the Demand for Health," Journal of Political Economy, University of Chicago Press, vol. 80(2), pages 223-255, March-Apr.
    10. Levine, Ross & Renelt, David, 1992. "A Sensitivity Analysis of Cross-Country Growth Regressions," American Economic Review, American Economic Association, vol. 82(4), pages 942-963, September.
    11. Kalemli-Ozcan, Sebnem & Ryder, Harl E. & Weil, David N., 2000. "Mortality decline, human capital investment, and economic growth," Journal of Development Economics, Elsevier, vol. 62(1), pages 1-23, June.
    12. Lant Pritchett & Lawrence H. Summers, 1996. "Wealthier is Healthier," Journal of Human Resources, University of Wisconsin Press, vol. 31(4), pages 841-868.
    13. Deolalikar, Anil B, 1988. "Nutrition and Labor Productivity in Agriculture: Estimates for Rural South India," The Review of Economics and Statistics, MIT Press, vol. 70(3), pages 406-413, August.
    14. Lahiri, Kajal & Schmidt, Peter, 1978. "On the Estimation of Triangular Structural Systems," Econometrica, Econometric Society, vol. 46(5), pages 1217-1221, September.
    15. Lucia Breierova & Esther Duflo, 2003. "The Impact of Education on Fertility and Child Mortality: Do Fathers Really Matter Less Than Mothers?," OECD Development Centre Working Papers 217, OECD Publishing.
    16. Kamakshya Trivedi, 2002. "Educational Human Capital and Levels of Income: Evidence from States in India, 1965-92," Economics Series Working Papers 97, University of Oxford, Department of Economics.
    17. Edward Miguel & Michael Kremer, 2004. "Worms: Identifying Impacts on Education and Health in the Presence of Treatment Externalities," Econometrica, Econometric Society, vol. 72(1), pages 159-217, January.
    18. AfDB AfDB, . "Annual Report 2012," Annual Report, African Development Bank, number 461.
    19. Hoyt Bleakley, 2003. "Disease and Development: Evidence from the American South," Journal of the European Economic Association, MIT Press, vol. 1(2-3), pages 376-386, 04/05.
    20. Ludger Vessman & Jerik Hanushek, 2007. "The role of education quality in economic growth (Part I)," Voprosy obrazovaniya / Educational Studies Moscow, National Research University Higher School of Economics, issue 2, pages 86-116.
    21. Nilanjan Banik, 2009. "Trade and Social Development: The case of Asia," Working Papers 6809, Asia-Pacific Research and Training Network on Trade (ARTNeT), an initiative of UNESCAP and IDRC, Canada..
    22. Peter J. Klenow & Mark Bils, 2000. "Does Schooling Cause Growth?," American Economic Review, American Economic Association, vol. 90(5), pages 1160-1183, December.
    23. Rosenzweig, Mark R, 1995. "Why Are There Returns to Schooling?," American Economic Review, American Economic Association, vol. 85(2), pages 153-158, May.
    24. Behrman, Jere R. & Deolalikar, Anil B., 1988. "Health and nutrition," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 1, chapter 14, pages 631-711, Elsevier.
    25. Hausman, Jerry A, 1975. "An Instrumental Variable Approach to Full Information Estimators for Linear and Certain Nonlinear Econometric Models," Econometrica, Econometric Society, vol. 43(4), pages 727-738, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Suri, Tavneet & Boozer, Michael A. & Ranis, Gustav & Stewart, Frances, 2011. "Paths to Success: The Relationship Between Human Development and Economic Growth," World Development, Elsevier, vol. 39(4), pages 506-522, April.
    2. Oliver Fritz & Peter Mayerhofer & Reinhard Haller & Gerhard Streicher & Florian Bachner & Herwig Ostermann, 2013. "Die regionalwirtschaftlichen Effekte der österreichischen Krankenanstalten," WIFO Studies, WIFO, number 46672, April.
    3. Bloom, David E. & Canning, David & Kotschy, Rainer & Prettner, Klaus & Schünemann, Johannes, 2024. "Health and economic growth: Reconciling the micro and macro evidence," World Development, Elsevier, vol. 178(C).
    4. Ranis, Gustav & Stewart, Frances & Ramirez, Alejandro, 2000. "Economic Growth and Human Development," World Development, Elsevier, vol. 28(2), pages 197-219, February.
    5. Husain, Muhammad Jami, 2010. "Contribution of health to economic development: A survey and overview," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 4, pages 1-52.
    6. Declan French, 2012. "Causation between health and income: a need to panic," Empirical Economics, Springer, vol. 42(2), pages 583-601, April.
    7. Liu, Gordon G. & Dow, William H. & Fu, Alex Z. & Akin, John & Lance, Peter, 2008. "Income productivity in China: On the role of health," Journal of Health Economics, Elsevier, vol. 27(1), pages 27-44, January.
    8. Alejandro Ramirez & Gustav Ranis, 1997. "Economic Growth and Human Development," Working Papers 787, Economic Growth Center, Yale University.
    9. Appleton, S., 2000. "Education and Health at the Household Level in Sub-Saharan Africa," Papers 33, Chicago - Graduate School of Business.
    10. Husain, Muhammad Jami, 2009. "Contribution of health to economic development: a survey and overview," Economics Discussion Papers 2009-40, Kiel Institute for the World Economy (IfW Kiel).
    11. Hanushek, Eric A., 2013. "Economic growth in developing countries: The role of human capital," Economics of Education Review, Elsevier, vol. 37(C), pages 204-212.
    12. Owen O'Donnell & Eddy Van Doorslaer & Tom Van Ourti, 2013. "Health and Inequality," Tinbergen Institute Discussion Papers 13-170/V, Tinbergen Institute.
    13. Hüseyin Taştan & Selin Erdoğan, 2018. "Cognitive skills and economic performance: evidence from the recent international student assessment tests," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 8(3), pages 417-449, December.
    14. Aribah Aslam, 2020. "The hotly debate of human capital and economic growth: why institutions may matter?," Quality & Quantity: International Journal of Methodology, Springer, vol. 54(4), pages 1351-1362, August.
    15. Jayasooriya, Sujith, 2020. "Revised Macro-Mincer Model for Human Capital Investment in Economic Growth," MPRA Paper 100747, University Library of Munich, Germany.
    16. repec:eee:labchp:v:3:y:1999:i:pb:p:2859-2939 is not listed on IDEAS
    17. Baldacci, Emanuele & Clements, Benedict & Gupta, Sanjeev & Cui, Qiang, 2008. "Social Spending, Human Capital, and Growth in Developing Countries," World Development, Elsevier, vol. 36(8), pages 1317-1341, August.
    18. Churchill, Sefa Awawoyi & Yew, Siew Ling & Ugur, Mehmet, 2015. "Effects of government education and health expenditures on economic growth: a meta-analysis," Greenwich Papers in Political Economy 14072, University of Greenwich, Greenwich Political Economy Research Centre.
    19. Weil, David N., 2014. "Health and Economic Growth," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 3, pages 623-682, Elsevier.
    20. Bahar Bayraktar-Sağlam Bayraktar-Sağlam, 2018. "Re-Examining Vicious Circles of Development: A Panel Var Approach," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 137(1), pages 231-256, May.
    21. Giuseppe Folloni & Giorgio Vittadini, 2010. "Human Capital Measurement: A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 24(2), pages 248-279, April.

    More about this item

    Keywords

    Growth; development; structural equation system; seemingly unrelated regressions (SUR) Model;
    All these keywords.

    JEL classification:

    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:unt:jnapdj:v:20:y:2013:i:2:p:109-127. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Macroeconomic Policy and Development Division, ESCAP (email available below). General contact details of provider: https://edirc.repec.org/data/escapth.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.