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Unformatted text preview: Burgess & Pande (2003) Credit and Microﬁnance “The banking system touches the lives of millions and has to be
inspired by larger social purpose and has to subserve national
priorities and objectives such as rapid growth of agriculture,
small industries and exports, raising of employment levels, encouragement of new entrepreneurs and development of backward areas. For this purpose it is necessary for the government
to take direct responsibility for the extension and diversiﬁcation of banking services and for the working of a substantial
part of the banking system?”
– (Bank Company Acquisition Act, 1969)
Structural Change in India
Look at state domestic product data for 16 main states of India over the
period 1960-2000 – these 16 states account for over 95% of Indian population
Real agricultural output per capita relatively ﬂat over period – growth in
agricultural output basically keeps track with growth in population
Real non-agricultural output per capita begins to diverge from agricultural
output around mid-1970s – but pattern highly varied across states
Assam, Bihar, Jammu and Kashmir, Madhya Pradesh, Orissa, Rajasthan,
Ut- tar Pradesh see limited structural change and economic growth – backward states – poor economic and social indicators Andhra Pradesh, Gujarat, Haryana, Karnataka, Kerala, Maharashtra, Punjab, Tamil Nadu, West Bengal – modern states – good economic and social
indicators pattern even more marked when we look registered and unregistered manufacturing and services
What accounts for different rates of structural change and economic growth
in Indian states? Answer has important ramiﬁcations, for example, for
Development Economics, LSE Summer School 2007 116 ...
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This note was uploaded on 12/29/2011 for the course ECO 307 taught by Professor Dublin during the Spring '10 term at SUNY Stony Brook.
- Spring '10