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A massive investment program is under way to meet the increased demand for chemical fertilizers in India. This paper reports on a preinvestment survey of that program. Such a survey cannot be viewed as a master plan for the development of the entire chemical fertilizer industry. Rather, it is intended to provide a rough framework within which to draw up a detailed proposal on the next few units to be built. The conclusions are intended to serve as the initial premises for a specific project: when, where, and how large a plant to construct. Necessarily, a preinvestment survey will contain fewer engineering details and will be less realistic than a report on a specific unit. [ABSTRACT FROM AUTHOR]

It is generally agreed that the marginal propensity to consume obtained from cross-section data pertaining to a single year may be seriously underestimated. To the extent that we need such estimates for the purpose of planning economic development, their accuracy becomes of crucial importance. Mayer has shown for developed societies, over a wide spectrum of dates and countries, that a permanent-income-type problem does exist; that is, the strict permanent-income theory is wrong in asserting that the marginal propensity to consume is equal to the average propensity, but it is right in suggesting that the marginal propensity to consume permanent income is greater than the marginal propensity to consume measured income, though even for permanent income the marginal propensity is less than the average propensity. It is the purpose of this paper to (1) extend these considerations to developing countries by looking at the available data on India, and (2) evaluate the effect of these considerations on the estimates of the marginal propensity to consume. The formulation suggested in the following sections has been applied to data collected by the National Council of Applied Economic Research, New Delhi. These include: (1) the Delhi Survey, 1959; (2) the Urban Income and Saving Survey, 1960; (3) the All-India Rural Household Survey, 1962; and (4) the All-India Consumer Survey, 1964. [ABSTRACT FROM AUTHOR]

This paper analyses the distributions of persons by per capita household consumer expenditure on all items estimated from the 13th Round (Sept. 1957-May 1958) of the Indian National Sample Survey (NSS) separately for the rural and urban sectors of the different states of India [19]. For rural India, urban India and all-India, the disparities in consumption are analyzed into between states and within states components. This is easily done by an analysis of variance of logarithms. Greater attention is given to measures related to the Gini-Lorenz concentration curve; but while the 'between states' concentration curve could be defined in an interesting manner, the 'within states' component could not be defined with equal success. [ABSTRACT FROM AUTHOR]

Serious doubts have been raised as to the validity of using cross-sectional estimates of the average propensity to consume over time. These doubts are based on empirical evidence for the United States presented by Kuznets and Goldsmith. This paper extends these considerations to developing countries by looking at the evidence for India. Simple statistical techniques, including ordinary least squares regression. Chow tests, and t-tests, are used in the estimation of the consumption functions and the formulation of hypotheses. Both India and the U.S. are seen to exhibit the same characteristic secular constancy in the average propensity to consume. For India the average propensity to consume is about 0.95 and is maintained in the face of no substantial secular increases in per capita income during the period under study (1919–1960). The same inconsistencies between time series and cross-section evidence on the average propensity to consume are found to exist for India. The permanent income theory suggested only a partial explanation of these inconsistencies and the reconciliation was achieved by a Duesenberry type explanation based on evidence for a shifting cross section consumption function over time. The data was provided by a set of Family Living Surveys for Industrial Workers: 1926, 1933–35, 1950–52, 1958–59. Finally it was noted that the cross-section consumption function in India had shifted both upwards and downwards over the period under study, in contrast to the strict upward shift for the U.S. In an economy such as India's, where secular growth is by no means assured, it is not always likely that consumers can avoid lowering previously achieved consumption standards in the face of cyclical economic conditions. [ABSTRACT FROM AUTHOR]

This paper presents an attempt to examine the applicability of the relative income hypothesis (RIH) in terms of its various specifications proposed by Duesenberry, Duesenberry, Eckstein and Fromm (DEF), Davis and the authors (MD). Using the time series data for 1951 through 1968 the analysis has been carried out for Canada, Finland, Guatemala, Honduras, India, Japan, Philippines, Sweden, United Kingdom and the United States. It is found that RIH provides a fairly good representation of the consumption behaviour of all the countries included in the study. All specifications, however, do not perform equally well. DEF and Davis functions score the maximum points; MD comes at par with DEF in case of Finland, Guatemala, and India. The original Duesenberry specification performs very poorly. This lends us to conclude that the process of habit formation is continuous contrary to what is implied by Duesenberry's original specification and that consumption is a better indicator of the standard of living than income is. Estimates of the long-run marginal propensities to consume are essentially the same as those computed from the permanent income hypothesis by Singh and Drost [1970]. This lends support to the view that the two hypotheses have essentially the same long-run implications. [ABSTRACT FROM AUTHOR]

In a recent issue of the Review of Income and Wealth[1], Uma Datta Roy Choudhury presented some results on consumption and saving functions in India. While the study is interesting, some of the results are quite peculiar. Thus she reports a marginal propensity to save of 0.88 for the urban sector, an abnormally high figure. Other available evidence points to a much lower figure. Again she reports a negative marginal propensity to consume out of permanent income for urban households. This makes no economic sense. Furthermore her attempts at explaining urban consumption behaviour are not very successful. In this paper, we shall show that these suspicious results are the consequences of the measurement and definitions of the variables, and the specification of the functions. Once these shortcomings are removed, we obtain more satisfactory and more plausible results. In the first section we present a critique of Mrs. Roy Choudhury's article. In the second section we present our results. The last section summarizes the conclusions. [ABSTRACT FROM AUTHOR]

This article discusses employment implications of India's industrialization. This article presents estimates of the sectoral direct and indirect employment potential of the 77 sectors of the input-output table. The static input output system is used to arrive at these estimates. No attempt has been made to discuss the problem of choice of techniques; however, the problem of product or output mix has been taken into consideration. The sectors are agricultural and create substantial employment per unit of final demand. Increase in the consumption of the products may not be acceptable due to its impact on capital accumulation. The conflict between present and future consumption and its impact on employment is clearly demonstrated. It should also be mentioned here that it may not be correct to hold the view that agricultural sectors are incapable of generating substantial employment. Among these nine sectors there are two key sectors, viz, metal products and petroleum products. Both these sectors are nonagricultural. The other seven sectors are characterized by poor forward linkages but strong backward linkages.

This examines the pricing of food in India and the sensitivity of consumer demand and producers' supply to pricing policies. In very recent years, in India at any rate, a good deal of evidence has piled up to the contrary. Shifts in relative acreage under different crops seem to be adequately explained by relative crop price changes together with weather and one or two other factors. Production, not only of commercial nonfood crops but also of food crops, seems sensitive to prices. There is some evidence of positive responses of marketed farm surpluses to price variations; and although controversy still exists, with supply responding positively, it is becoming increasingly difficult to maintain that marketed supply does not respond or responds negatively to prices.

The aim of the article is to establish an efficiency condition for maximum output when consumption enters into the cost of production. To make the purpose potentially useful and valid, three assumptions are required. First, the marginal productivity of labor in the consumption goods industries must be zero. Second, it must be positive in the capital goods industries. Third, the government must be unable or unwilling to take steps to see that more labor can be employed without an increase in total consumption. The author's arguments have been developed with the Indian economy in mind. In the country the figures do not throw sufficient light because of the seasonality of employment. In many areas at least, the labor force is probably fully employed at planting and harvest time. But it seems to be widely agreed that substantial quantities of labor could be released, even at peak periods, with no effect on production if other measures were taken. It is important to note that the optimum or efficiency condition holds even if the aim is to maximize investment. It is important because the powerful desire of many leaders of opinion in most underdeveloped countries to develop as fast as possible may be interpreted to mean that capital equipment should grow, for some years at least, as fast as possible albeit subject to a tolerable minimum pattern of consumption growth.

Discusses what might happen if taxation in used as a tool to reduce inequalities in the distribution of consumption expenditure in India. Distribution of households according to per capita consumption expenditure; Consumption expenditure by population deciles.