Agricultural Growth and Welfare: A Study on Indian States

Abstract

An underdeveloped country like India is marked by the presence of a considerable degree of unevenness in the pattern of growth among various regions. However, till now, most of the studies failed to consider the welfare implications of such a differential growth pattern. This article attempts to analyze such welfare aspects of growth by using Kakwani's (1997) growth parameters. Based on the aggregated state-level data on area, production and yield on some major crops (viz., rice, wheat and foodgrains) in India, the study reveals considerable variations in state- wise growth rates. It is observed that there is a diminishing returns to scale in operation which slows down the growth rate of the leading states. However, the less-developed states have not been able to catch up adequately over time. The result is also supported by the periodization analysis as suggested by Kakwani (1997). The study concludes that the growth of agriculture over the last 50 years after Indian Independence has been highly unequal. The new policy changes have failed to bring about a shift in this pattern so as to enhance the economic well-being of the people.