May 03, 2019

Economic geography central to India’s regional inequality woes

Writing in Mint, Research Director and Senior Fellow Niranjan Rajadhyaksha encourages policymakers to examine India's regional inequality problem through the lens of economic geography – density, distance, and division.


"Is regional inequality in India actually a problem of economic geography? There are two good reasons to revisit this question right now. First, the past few years have seen renewed rumblings about how some states are benefiting at the expense of others. The ongoing national election has been free of such issues, but the next one will be fought under the shadow of the delimitation that is due in 2026, and which could redistribute political power to the North while economic power gets concentrated in the South.


Second, this year marks the tenth anniversary when economic geography entered mainstream policy debates across the world, thanks to the decision by the World Bank to devote its 2009 edition of the World Development Report to the issue of reshaping economic geography. The intellectual roots of the new economic geography can be traced back to landmark papers by Paul Krugman, especially the 1991 paper titled Increasing Returns And Economic Geography. Krugman himself built on some of the earlier insights from Avinash Dixit and Joseph Stiglitz."


Read the full article here.

Topic : State Capacity / In : OP-EDS
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