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The Indian Economy in the Second Decade of the 21st Century: Signs of a Crisis?

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  • Mazumdar, Surajit

Abstract

Despite apparently experiencing reasonably good GDP growth rates in that period, there are several indications that the growth process of the Indian economy entered into a phase of crisis in the second decade of the current century. Investment and trade stagnation and increasing dependence on consumption demand, coupled with poor industrial (including construction) and agricultural growth, mark out this decade and differentiate it sharply from the period of high growth that preceded the global crisis of 2008. Arguing that Indian growth has been primarily based on cheap labour throughout the liberalization period, this paper argues that the distributional imbalances implied in such a growth trajectory facilitated the earlier boom even as they made it unsustainable. The current crisis, however, is more than a cyclical downturn and may in fact reflect the limits of growth through cheap labour.

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  • Mazumdar, Surajit, 2017. "The Indian Economy in the Second Decade of the 21st Century: Signs of a Crisis?," MPRA Paper 93164, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:93164
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    References listed on IDEAS

    as
    1. Lucas Chancel & Thomas Piketty, 2019. "Indian Income Inequality, 1922‐2015: From British Raj to Billionaire Raj?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 65(S1), pages 33-62, November.
    2. Dani Rodrik & Arvind Subramanian, 2005. "From "Hindu Growth" to Productivity Surge: The Mystery of the Indian Growth Transition," IMF Staff Papers, Palgrave Macmillan, vol. 52(2), pages 193-228, September.
    3. Mazumdar, Surajit, 2008. "Investment and growth in India under liberalization: Asymmetries and Instabilities," MPRA Paper 19629, University Library of Munich, Germany.
    4. Arvind Virmani, 2004. "India's economic growth: From socialist rate of growth to Bharatiya rate of growth," Indian Council for Research on International Economic Relations, New Delhi Working Papers 122, Indian Council for Research on International Economic Relations, New Delhi, India.
    5. T. N. Srinivasan, 2005. "Comments on "From 'Hindu Growth' to Productivity Surge: The Mystery of the Indian Growth Transition"," IMF Staff Papers, Palgrave Macmillan, vol. 52(2), pages 229-233, September.
    6. Piketty, Thomas & Chancel, Lucas, 2017. "Indian income inequality, 1922-2014: From British Raj to Billionaire Raj ?," CEPR Discussion Papers 12409, C.E.P.R. Discussion Papers.
    7. Surajit Mazumdar, 2014. "Globalisation and Growth: The Indian Case in Perspective," India Studies in Business and Economics, in: Ratan Khasnabis & Indrani Chakraborty (ed.), Market, Regulations and Finance, edition 127, chapter 12, pages 213-230, Springer.
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    More about this item

    Keywords

    India; Crisis; Industrial Development;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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