Volume : IV, Issue : V, May - 2014

Economic Growth and Consumption in Urban India

Sarita Agrawal

Abstract :

The process of economic growth is also marked by several socio–economic changes. Urbanisation is an im – portant fall out of the process of economic growth. As centres of industry and commerce, cities have been centres of wealth and political power and contribute significantly to the country’s GDP. The process of urbanization is radi cally changing the socio–economic structure of the world economy. The change is much more rapid in the less developed economies where the rate of urbanization is much faster compared to that in the developed countries. Urban areas are the nerve centres of economic activities and have significantly contributed to the economic growth of the country and improve ment in the income. The present study shows that both GDP and PC GDP have increased during the planning period in India but PC GDP has increased at a lower rate compared to GDP. Income inequalities have increased in India though marginally. Monthly Per Capita expenditure has increased at a much faster rate compared to PC GDP. However, at constant price the rate of growth of MPCE is very low. Thus, rise in MPCE at current price may be attributed to rising prices. During 2009–10 and 2010–11, the consumption has increased only marginally for the lower decile income groups. It is the upper most income group that has witnessed a high consumption growth. When the monthly per capita expenditure declines, it is the expenditure on non–food items that is affected. Hence, expenditure on non–food items is elastic with respect to total expenditure. Also, the expenditure on education and health is elastic with respect to expenditure on non–food items.

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Article: Download PDF   DOI : 10.36106/ijar  

Cite This Article:

Sarita Agrawal Economic Growth and Consumption in Urban India Indian Journal of Applied Research, Volume.4, Issue.5, May-2014


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