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Growth and Structural Change: an Experience of Uttarakhand Economy

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Growth and Structural Change: an Experience of Uttarakhand Economy International Journal of Multidisciplinary Research and Development International Journal of Multidisciplinary Research and Development Online ISSN: 2349-4182, Print ISSN: 2349-5979; Impact Factor: RJIF 5.72 Received: 13-06-2019; Accepted: 15-07-2019 www.allsubjectjournal.com Volume 6; Issue 9; September 2019; Page No. 61-67 Growth and structural change: An experience of Uttarakhand economy Kailash Bharti Goswami1, Padam Singh Bisht2 1 Research Scholar, Department of Economics, D.S.B. Campus, Kumaun University Nainital, Uttarakhand India 2 Professor, Department of Economics, D.S.B. Campus, Kumaun University Nainital, Uttarakhand India Abstract In any economy primary, secondary, tertiary and agriculture, industry, services are directly related to each other. This separation has been used the distinctive pattern of structural change in any economy. This is the most common phenomenon which hold true in all counties which is experiencing structural shift. In these countries the contribution of primary sector has registered a steady turn down in the total output, whereas that share in secondary sector is showing an increasing trend for a long time and after that it has declined and finally services sector has hold as economy developed in every economy as a common path of structural change. The aim of this study is to analyze the structural transformation process in Uttarakhand economy using secondary data based on a range of parameter of structural transformation as share of different sector in State Gross Domestic Product, performance of their growth parts at aggregated and disaggregated level and employment scenario in Uttarakhand economy. The results shows that the economy of Uttarakhand shows the pattern of structural shift in sectoral share as well as occupation structure. Keywords: structural change, Uttarakhand economy, state gross domestic product, work force participation 1. Introduction Among the sources of structural transformations, the The term ‘structure’ and ‘structural change’ have turn out to literatures mainly revolves around two main dynamics: be frequently used in economic study, although with diverse sectoral specialization, first, leads back to the classical meanings and interpretations. As an economy grows it will argument that economies focus their activities on the most experience some structural changes. This model of competitive sectors or more inclined to increase to increase structural change has not only been observed traditionally, gains in efficiency. Second, the changes in the structure of but also across the countries with diverse levels of consumption, lead back to the pasinettian argument. The expansion. Structural shifts and changing sectoral shares are structure of the economics as well as their transformations found to hold excellent for both the national product and the are induced either by differences in the potential expansion work-force. The premise of structural transformation has of demand or by the emergence of new products or new given chief place to the industrial sector and termed it as sectors. engine of growth because industrial sector has strongest The distinguishing characteristic of India’s growth has been forward and backward growth linkages, subject to the increasing function of services sector to GDP growth. increasing returns for longer duration and larger labour Structural changes play an essential role in the path of incorporation capability. economic growth and hence in raising the living standards Economic growth and economic transformation have been of Indians. Indian economy when it embarked on the the major developmental argue during the early era of development process after Independence in 1950, with economic development (Colin Clark, 1940, Chenery and about 60 per cent of GDP accounted for by agriculture, Taylor, 1968; Rostow, 1960; etc) [1]. To speed up the industry contributing about 13 and services about 27 per process of economic growth in a continued manner has cent, it was structurally comparable to the economy of the become the most important policy issue in contemporary Great Britain in late eighteenth century, and of Germany at scenario. There are many studies which hit upon out that the beginning of the nineteenth century, of the United States acceleration in economic growth is due to their structural and Italy of mid-nineteenth century and of Japan in 1900. transformation (Nayyar 2006) [3]. According to the United Similar comparisons hold in respect of the share of labour Nations surveys, an examination of pattern of structural force in different sectors: farming sector accounted for change over the past decades indicates that the speedy about 75 percent, industry for about 11 and services 16 growing developing economies are clearly characterized by percent of total employment in 1950, in India. This is vibrant transformations. comparable with the United States of 1841, with 72 percent It has been extensively asserted that structural change is an workers in agriculture, 12 per cent in industry and 16 essential condition for the Indian economy to enjoy percent in services, or Japan of 1880 with the respective sustained economic growth at a satisfactory level. Indian shares of employment in the three sectors being 65 percent, economy like numerous other growing economies has also 15 percent and 20 percent. witnessed momentous structural changes in recent years. The economy of Uttarakhand which is dominated by These structural changes indicate that the course of agrarian activities continues to be backward in agriculture development which began in the early 1950s is still growth in major parts of the state in the national context. ongoing. The state being well-off in human and natural wealth and 61 International Journal of Multidisciplinary Research and Development having vast fertile plains has shown high growth observes that there is direct relationship between growth and performance over the years which remained above the structural change. The study reveals that this structural shift national average. The state economy witnessed considerable in Haryana is at faster rate as compare to Indian economy. structural changes in recent years in all the sectors of the The result shows that in the share of primary sector in state economy. This may at first glance be visualized from SGDP of Haryana there is continuous decline since 1990. the changes in sectoral composition of the state income over Agarwal & Ghosh (2015) [10] examines the structural break the years. This is shown from the fact that state has 51.24 analyses of several macroeconomic variables for the Indian percent share in industrial output in 2015-16. The share of economy from various dimensions. The study revelas that agriculture sector in state economy has been constantly the Indian economy exhibits multiple structural breaks, in decreasing, the share of this sector was 28.22 percent in GDP & Per Capita Income and also in external sector of the 2000-01 and it decreased to 11.54 percent in 2015-16. The economy but, there is no statistically structural break in increasing share of secondary and tertiary sector shows the growth rate and no acceleration of growth rate has occurred. structural shift in state economy but this change is very The external sector of the economy has many multiple slow. It has virtually given a fillip to traditional and stagnant structural breaks. state economy. 3. Objectives of the Study 2. Review of Literature 1. To study the structural changes and sectoral growth Economists, agriculturalists, scholars etc. have done a performance in the economy of Uttarakhand momentous work on the Growth and Structural changes in 2. To study the changes in the primary, secondary, tertiary different economy. Various fields like structural changes in sector and changes in occupation pattern in the state agriculture, Patterns of growth have been largely undertaken during the period of analysis by these Economists, agriculturalists of different fields from different institutions and universities. The thematic reviews 4. Research Methodology of work done by scholars in the field Growth and structural Research Methodology is a way to solve the research changes are given below: problem systematically. This methodology section deals Modern reckoning of sectoral revolution originated with with the research techniques and the methods applied by the Fisher (1939) [9] and Clark (1940) [1], who negotiate with researcher in the collection and in the analysis of the data sectoral shifts in the concerto of the labour force. However, collected. The proposed study aims to analyzing the growth they were almost certainly the first to deal with the process and structural changes in the economy of Uttarakhand. This of reallocation of the factors of production in the economic research is both the descriptive and analytical by nature. The growth, and use the form of sectoral separation (primary, data on the net domestic product by the origin of industry as secondary & tertiary) which, in one way or another, is still well as data on other aspects of the economy, has been taken with us these days. The most habitual events of economic from the estimates published in the statistical diaries, structure are sectoral shares of the labour force. statistical abstracts, state income estimates etc. of various Rangarajan (1982) [5] in his empirical study also highlighted years, published by Economic and Statistical Directorate the interdependence between farming & non farming growth and other Statistical organizations
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