Edited by Brian K. MacLean, Hassan Bougrine and Louis-Philippe Rochon
Chapter 8: Employment in India: aggregate demand and structural transformations
This chapters examines the paradox that despite India having experienced high economic growth for some time now, substantial income increases have not been enjoyed by lower-income groups. This is explained in part by employment growth being meagre in relation to output growth, and a lack of initiatives from the state to provide social benefits. Taking into account the large share of the informal sector in India and the structural evolution of the economy, the chapter argues that conventional tight monetary and fiscal policies in India have combined with deregulation of finance to produce a poor record of job creation. A proper explanation of the situation requires both Keynesian aggregate demand analysis and analysis of the structural change in the economy.
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