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Ashok Kotwal
GST Explainer: Introduction
Posted on: 16 Oct 2017
Seventeen years after its framework was formed, India’s biggest tax reform – the goods and ... read on »
Introducing a new feature: ‘Explainers’
Posted on: 16 Oct 2017
Our day-to-day lives are tossed around due to economic changes, resulting sometimes from g ... read on »
On demonetisation
Posted on: 23 Dec 2016
On the evening of 8 November, the Prime Minister announced on national television that Rs. ... read on »
Introduction to e-Symposium: The GDP conundrum
Posted on: 16 Nov 2016
Ever since India’s Central Statistical Organisation came out with the new GDP series with ... read on »

Topic: Productivity

Using drones for social sector research
Outline India
Posted on: 19/06/2017 03:49:26

While drones have historically been used in military operations, their application for peaceful purposes has risen steeply in recent years. In this note, representatives from Outline India - a research and development consultancy firm - discuss their efforts to integrate drones in social sector research to make data analysis more evidence-based, visualise policy performance, and produce actionable research materials to aid public policy making and monitoring.
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How the American dream led to India’s IT boom
Gaurav Khanna , Nicolas Morales
Posted on: 29/05/2017 09:27:57

In the context of the ongoing global debate on migration policies, this column shows that the H-1B visa programme of the US had a powerful impact on the US IT sector, and played a prominent role in spreading the boom to India.
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Assam’s Brahmaputra Community Radio Station: Innovation in health communication
Anjali Mariam Paul
Posted on: 12/05/2017 22:49:42

River Brahmaputra which flows across the Northeast Indian state of Assam, carves out a network of nearly 2,300 islands, isolating them from the mainland and excluding their inhabitants from access to basic infrastructure and health facilities. Based on her fieldwork, Anjali Mariam Paul describes the working of an innovative intervention in health communication – a non-commercial grassroots community radio station for these river islands.
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The historical roots of India’s booming service economy
Stephen Broadberry , Bishnupriya Gupta
Posted on: 13/01/2017 09:40:33
Tags:   services , UK


India stands out from other emerging economies because its growth has been led by the service sector rather than labour-intensive manufactures. This column summarises recent research showing that India has a long history of strength in services, and its service-led development may play to historical strengths rather than hindering its progress.
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Nobel prize in Economics 2016: The economy as a nexus of contracts
Maitreesh Ghatak
Posted on: 19/10/2016 03:55:08
Tags:   management


An important line of research in microeconomics has tried to explain how the economic institutions that underpin the ‘invisible hand of the market’ actually work. The specific economic institution that Hart and Holmström focus on is contracts. In a tribute to the Nobel laureates, Maitreesh Ghatak, Professor of Economics at the London School of Economics, discusses the working and importance of contract theory.
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Nobel insights: When it comes to contracts, what’s obvious may not be optimal
Rohini Somanathan
Posted on: 18/10/2016 09:28:54

In a tribute to Oliver Hart and Bengt Holmström, recipients of this year’s Nobel prize in Economics, Rohini Somanathan, Professor of Economics at Delhi School of Economics, outlines their contributions.
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The hidden productivity benefits of energy-saving technology: Evidence from LEDs in Indian factories
Achyuta Adhvaryu , Namrata Kala , Anant Nyshadham
Posted on: 03/10/2016 09:40:47

Energy-efficient technologies are an increasingly relevant policy priority, given growing consensus on the need to tackle climate change. This column examines the productivity benefits of adopting one such technology – LED lighting – for manufacturing firms in India. It finds that improved productivity resulting from LED lighting’s lower heat emissions makes adopting such technology far less costly than previous anticipated, particularly for labour-intensive firms in hot climates.
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Fast breeder reactors and the slow progress of India’s nuclear programme
M.V. Ramana
Posted on: 16/08/2016 10:05:12

Breeder reactors have always underpinned the claims of India’s Department of Atomic Energy about generating large quantities of electricity. The first Prototype Fast Breeder Reactor was expected to start sustaining a chain reaction back in 2010, but the reactor is massively delayed, taking more than twice the expected period. In this article, M.V. Ramana, a physicist at Princeton University, outlines the history of missed targets and contends that these reactors are best regarded as failed technology, in India and elsewhere.
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Analysing worker responses to a contract change
Rajshri Jayaraman , Debraj Ray
Posted on: 08/08/2016 08:20:01

Higher-powered incentives are generally believed to increase worker productivity. In the context of an Indian tea plantation, this column examines a contract change wherein baseline wages were increased and incentive piece rates were lowered or kept unchanged. It finds that output increased by 20-80% in the following month but fell to original levels thereafter. Possible explanations for the observed impact are explored.
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Land and financial misallocation in India
Gilles Duranton , Ejaz Ghani , Arti Grover Goswami , William Kerr
Posted on: 20/07/2016 09:20:53

Optimising the allocation of factors of production – land, capital and labour - improves productivity. In India, where evidence suggests land is severely misallocated to inefficient manufacturing firms, access to financing is disproportionately tied to access to land. This column examines the link between the misallocation of land and access to capital through financial markets. A very strong positive correlation emerges between the two, consistent with the fact that land and buildings can provide strong collateral support for accessing finance from the credit market.
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Indian agriculture: How to feed more people with fewer resources
Gareth Price , Ira Sharma , Ashwini Kumar Swain
Posted on: 05/07/2016 09:27:43

While agriculture in India has achieved grain self-sufficiency, it has become cereal-centric, regionally-biased and resource-intensive. In this article, Swain, Price and Sharma discuss the rising resource intensity in Indian agriculture and its implications for agricultural sustainability, productivity and future food production. They explore government initiatives to address the situation and suggest a strategy to increase production with fewer resources.
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Using science to improve Indian agriculture
Robert S. Zeigler
Posted on: 26/06/2015 00:00:00

Five years ago, the Indian government imposed a ‘temporary’ moratorium on the commercial release of Bt brinjal – a genetically modified crop - even after it had passed through the due regulatory processes. In this article, Robert S Zeigler, a plant pathology expert, outlines the benefits of transgenic crops and emphasises the need to expedite their adoption in India.
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Promoting the use of a novel water-saving agricultural technology among Indian farmers
Anil Bhargava , Kajal Gulati , Travis J. Lybbert , Nicholas Magnan , David J. Spielman
Posted on: 28/04/2015 00:00:00

The Met Department has forecasted a below-normal monsoon in India this year. This column analyses the demand for a water-saving agricultural technology — laser land levelling — among farmers in Uttar Pradesh. It also discusses how such information can feed into the design of a novel approach to combining public subsidies with private service provision to encourage the technology’s uptake among small-scale, resource-poor farmers.
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How serious are India’s manufacturing skill gaps?
Aashish Mehta
Posted on: 13/04/2015 00:00:00

It is widely believed that skill gaps are constraining Indian manufacturing, and closing these gaps has become a national priority. This column argues that the public debate on India’s skill gaps rests on weak conceptual foundations. While some industries do suffer from real skill gaps, others are constrained by commercial difficulties that may be better addressed through policies other than skill development programmes.
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Does affirmative action reduce productivity? The case of Indian Railways
Ashwini Deshpande , Thomas Weisskopf
Posted on: 21/01/2015 00:00:00

Critics of job reservations argue that such policies have an adverse effect on work efficiency and productivity. This column analyses the effect of job reservations in the Indian Railways – the world’s largest employer subject to affirmative action. It finds that having a larger proportion of lower-caste employees is not associated with lower productivity; in top-tier jobs, in some cases, it is actually associated with higher productivity.
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Building state capacity for better programme implementation: Lessons from the Andhra Pradesh Smartcard Programme
Karthik Muralidharan , Paul Niehaus , Sandip Sukhtankar
Posted on: 03/12/2014 00:00:00

Biometric payment systems are posited to reduce leakages in public welfare programmes but there is limited evidence on their effectiveness. This column presents evidence on the impact of the Andhra Pradesh Smartcard Programme on MNREGS and Social Security Pension beneficiaries, based on a large-scale randomised controlled trial. It finds substantial economic benefits, and concludes that using biometric payment infrastructure to deliver welfare payments can be a game changer for governance in India.
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How well does DBT work on the ground?
Sweta Trayambak
Posted on: 04/08/2014 00:00:00

PM Modi has emphasised fast-tracking roll-out of the Adhaar-based Direct Benefits Transfer programme. In this note, Sweta Trayambak – who has worked with the district administration of Ramgarh in Jharkhand on the roll-out of DBT - highlights the key strengths of the programme, and problems faced in implementation on the ground.
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Reconstructing facts in Bt cotton: Why scepticism fails
Ronald Herring
Posted on: 02/06/2014 00:00:00

In disputes around Bt cotton, a “triumph narrative” is alleged to have emerged from researchers - mainly economists - catering to vested interests of the biotech industry, its funding and allied journals promoting biotechnology. This column explains why the ‘conspiracy theory’ fails, and then illustrates why the main claims of the peer-reviewed literature demonstrating agro-economic success of Bt cotton are consistent with the near universal adoption of the technology by farmers in India.
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Reversing premature de-industrialisation in India
Amrit Amirapu , Arvind Subramanian
Posted on: 26/05/2014 00:00:00

In countries across the world, de-industrialisation is taking place earlier in the development process. This column analyses how India fares in this regard. It finds that for most Indian states, the share of manufacturing in GDP peaked in the 90s, at levels far lower than comparable Asian countries, and began declining thereafter. Reversing this process is not going to be easy.
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The costs of employment protection
Sean Dougherty , Veronica Frisancho , Kala Krishna
Posted on: 30/04/2014 00:00:00

Restrictive labour laws govern the formal sector in India, whereas the informal sector is virtually unregulated. This column analyses the impact of reforms pertaining to employment protection legislation on firm performance. It finds that, on average, labour-intensive firms in states that have transited towards more flexible labour markets are 25% more productive than their counterparts in states with lower levels of reform.
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How innovations in telecom can promote inclusive growth
Ashima Goyal
Posted on: 28/03/2014 00:00:00

Applications of Information and Communications Technology, such as mobile banking, have potential to promote inclusive growth and equity. This column analyses conditions under which innovations in ICT can benefit the less well off, and how such innovations can be expedited. It recommends public provision of supporting infrastructure, focusing on consumer needs and reducing transaction costs for consumers.
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Growth, structural change, and poverty reduction: Evidence from India
Rana Hasan , Abhijit Sen Gupta
Posted on: 21/03/2014 00:00:00

Poverty reduction in India has been relatively slow even in years of high economic growth. A possible explanation is that growth has mainly been driven by sectors that generate fewer jobs for the poor. This column analyses this explanation and finds that structural change or the reallocation of jobs from low productivity to high productivity sectors, plays a key role in reducing poverty.
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Why is Maharashtra´s average income five times that of Bihar?
Areendam Chanda
Posted on: 09/12/2013 00:00:00

Income gaps among Indian states are large, persistent and increasing over time. Differences in technology and efficiency in production processes have been found to be the primary explanation for income gaps across countries. Does the same apply to Indian states? This column attempts to answer this question, with a particular focus on Bihar – the state with the lowest average income in the country.
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Do the poor need genetically modified crops?
Milind Murugkar
Posted on: 22/11/2013 00:00:00

Field trials of a few genetically modified crops were recently put on hold by the Environment Ministry. This article asserts that the decision reflects an ideological resistance to and suspicion about the technology, which is at odds with the government’s stated policy of using GM crops for the benefit of rural poor. It argues that GM crops can go a long way in helping farmers by improving crop yields.
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How labels influence the decision to buy genetically modified food
Sangeeta Bansal , Sujoy Chakravarty , Bharat Ramaswami
Posted on: 28/10/2013 00:00:00
Tags:   consumption


A regulation mandating labelling for all packaged products has been in effect in India since the beginning of this year. This column examines the role of information provided by labels in the decision of consumers to buy genetically modified food. It is found that Indians have a lower threat perception of genetically modified ingredients as compared to Europeans.
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Micro-innovations in education
Sharath Jeevan , James Townsend
Posted on: 17/07/2013 00:00:00

The poor quality of school teachers is widely acknowledged as a major obstacle to the educational success of children from low income families. STIR Education visited and spoke to over 3,000 teachers in government and affordable private schools in New Delhi and compiled a list of replicable micro-innovations suggested by them. The exercise demonstrates that if given the opportunity, teachers can be a part of the solution, rather than a barrier to education reform.
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Bad management: A constraint on economic development?
Renata Lemos , Daniela Scur
Posted on: 08/07/2013 00:00:00
Tags:   management


Are poor management practices holding back middle-income countries? This column looks at the evidence for private firms and public organisations in manufacturing, retail, healthcare and education in India. The findings suggest that there is a large share of badly managed firms that brings down the average quality of Indian businesses. While some Indian firms are at par with the best in the world, diffusion of best practices has not taken place yet.
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India’s disputed ruling on pharmaceuticals and patents
Arvind Subramanian
Posted on: 10/04/2013 00:00:00

On April 1 2013, the Supreme Court of India rejected the attempt by Novartis, the Swiss pharmaceutical company, to patent a new version of the leukemia drug Glivec. The verdict follows previous rulings that granted compulsory licenses to an Indian generic drug manufacturer for a kidney cancer drug (Nexavar) patented by Bayer. This article discusses five important questions raised by these rulings.
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Electricity demand in urban Indian households: Influencing consumer behaviour
Anant Sudarshan
Posted on: 08/04/2013 00:00:00
Tags:   electricity


The huge and fast growing urban middle class of India uses a significant amount of electricity at their homes. This column argues that there is a need to focus on managing demand of electricity, and demonstrates how social norms can be used to encourage households to consume less electricity.
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The push and pull of skilling
Madhav Chavan
Posted on: 22/03/2013 00:00:00
Tags:   training


Vocational training has been centre-stage in policy discussions in India over the past decade. This article discusses the perspectives of and dissatisfaction among the four groups of stakeholders in skill training – government, industry, trainers and potential trainees. It highlights the need for a strong “pull” or demand for training and suggests innovative ways to achieve this.
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What do Indian CEOs do?
Oriana Bandiera
Posted on: 15/03/2013 00:00:00

While the Indian manufacturing sector has experienced rapid growth since the early 1990s, it is characterised by large productivity differences across firms and presence of several low productivity firms that use poor managerial practices. This column examines differences in CEOs’ management style via their time use to provide new insights on the observed diversity across firms.
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Property rights and technology transfer: Evidence from developing countries
Sunil Kanwar
Posted on: 01/03/2013 00:00:00

The transfer of technology to poorer countries is essential for development. This column asks how this process is affected by intellectual property rights and whether the data can provide some policy insights.
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Is the District Innovation Fund being utilised?
Ajit Kumar Nayak
Posted on: 08/02/2013 00:00:00

The 13th Finance Commission has recommended the creation of a District Innovation Fund in each district. The objective of the fund is to increase the efficiency of existing capital assets by filling vital gaps in public infrastructure projects that are near completion. Is the Fund being utilised in the way intended? In this Note from the Field, a PMRDF working with the district administration of Kalahandi in Odisha provides a perspective.
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Use of technology to improve public service delivery
Chandrasekhar Bhuyan , Animesh Ghosh , Kshovan Guha , Dipti Paridhi Kindo , Priyanka Kumari , Ankush Singh , Sushma Taywade , Sweta Trayambak
Posted on: 06/02/2013 00:00:00

How is technology being used to improve public service delivery at the grass root level? In this Note from the Field, the Prime Minister’s Rural Development Fellows that are working with district administrations across the country, share their experiences.
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Helping India’s informal manufacturing sector to grow
Kunal Sen
Posted on: 09/01/2013 00:00:00

India’s informal manufacturing sector is dominated by small household enterprises that keep everything within the family – but these firms are often the least productive. Why aren’t these small enterprises making the changes needed to bloom and grow? This column asks whether the problem is access to finance and what can be done about it.
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How to motivate India’s community workers?
Nava Ashraf
Posted on: 04/01/2013 00:00:00
Tags:   Africa


People who work on-the-ground are essential to India’s development effort. But how to get these teachers, health workers and so on to work hard when money is tight? This column argues that there are other ways to motivate community workers that aren’t being used to their full potential – and there might be better ways to choose the best workers as well.
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Manufacturing, management and mysteries
Nirvikar Singh
Posted on: 27/07/2012 00:00:00

The private sector is crucial to India’s development. This column asks how it can be more effective. Looking at a large sample of Indian manufacturers it suggests that what many firms may be missing is good management.
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