SOURCES OF OUTPUT GROWTH IN INDIAN AGRICULTURE DURING THE POST-REFORM PERIOD

K.R. Shanmugam and Vidhya Soundararajan ()
Additional contact information
Vidhya Soundararajan: Madras School of Economics

Working Papers from Madras School of Economics,Chennai,India

Abstract: Economic growth has failed to be sufficiently inclusive, particularly after the mid-nineties. Although agriculture is still a single major sector providing livelihood to more than 60 percent of the population, it has lost its growth momentum and the share has been declining continuously for a variety of reasons like low income due to inadequate output growth, low productivity, low prices of output, lack of credit at reasonable rates, natural calamities and unavailability of proper extension services. Realizing the importance of this sector and its current crisis, the eleventh plan aims to reverse this trend. Output growth could be possible by increasing input growth, technical progress and improvement in technical efficiency. In order to identify the source of the problem, this paper attempts to decompose the agricultural output growth obtained in 15 major states for the period 1994-95 to 2003-04 into the above three components using the random coefficients model. Results of the study indicate that the efficiency has declined over time for all the states and the average technical efficiency is only 72 percent. This means that there is a potential to increase the existing output by 28 percent without increasing inputs. We found that in most of the states, growth was only due to higher inputs. Investment in extension services along with sustained investment in agricultural research and development, and infrastructure is the need of the hour. West Bengal is the most efficient state in applying labor and fertilizer inputs and also has a very high over all efficiency. This can be linked to the successful decentralization and the land reform policies of the state.

Keywords: Agriculture (search for similar items in EconPapers)
Pages: 13 pages
Date: 2008-02
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.mse.ac.in/wp-content/uploads/2016/09/working-paper-26.pdf

Related works:
Working Paper: Sources of Output Growth in Indian Agriculture during the Post-Reform Period (2008)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mad:wpaper:2008-026

Access Statistics for this paper

More papers in Working Papers from Madras School of Economics,Chennai,India Contact information at EDIRC.
Bibliographic data for series maintained by Geetha G ().