DT 1-10

Lecture topic
What is Development? – Changing Paradigms
PRM Course
Development Theory
Hippu Salk Kristle Nathan

Institute of Rural Management Anand
Dt. 02-03 November, 2020
What is development?
• Growth rate; rise in personal income
• Industrialization; technological advance
• Access to services; satisfaction of basic needs
• Social modernization
• Capabilities; freedom
Sen’s capability approach
• Satisfaction/happiness
Bhutan’s GNH
Sen’s flute example
• Child A: the only one of the three that knows how to play it.
• Child B: is poor and has no other toy of his own to play with.
• Child C: has been working on the flute for months, so deserve it
Who should get the flute?

and Why???
(Sen, 2006)
Two major paradigms shift
towards Human development
towards Sustainable development

Shortcomings of GDP
Treats ‘goods’ and ‘bads’ as same:
Considers only economic value (not social value, not environmental

consequences)
Tobacco and health care – treated same
Power plant – do not take into account environmental consequences
Not account the damage to the assets resulting from pollution
Increases with polluting activities and again cleanups

(pollution: double benefit to the economy)
Crime, divorce, and natural disasters as economic gain

Example: transportation sector: bus travel vs. train travel
Shortcomings of GDP
Cont...
Depletion of natural capital as income
Example – Income for extracting minerals recorded, but simultaneous
depletion is not.
Misleading signal on sustainable national income
– growth is through liquidation of natural capital:
short run ~ long run
For a natural resource dependent economies, GDP and saving are
overstated.
Shortcomings of GDP
Cont...
Ignore non-market activities
Childcare, elder care, other home-based tasks, and volunteer work
in the community go completely non-reckoned
Harvest of firewood or wild foods for own use.
Non-marketed goods provided by ecology – not accounted

(Example: recreation value of forests, forest provides watershed protection
– benefiting agriculture, hydro power, municipal water system)
Several features which cannot be monetized – beauty of a village.

Shortcomings of GDP
Cont...
No account of income distribution:
Average; total
No account of quality of products:

Same economic value – quality of products may change
No account of quality of life:

Leisure
Capabilities
Challenging fundamental notion of GDP

Degrowth; Human Development; Sustainable Development
Degrowth
Well-being of all, and maintains the natural basis of life
Antithesis of ‘faster, higher, further’
- “the only sustainable growth is degrowth”
“Degrowth is a political, economic, and social movement based on anti-

consumerist and anti-capitalist ideas”
“It raises the prospect of finally ejecting the twin demons of

productivism and consumerism that are responsible for so many
historical failures…”
(Graeber, 2015)
Degrowth
Cont...
“Downscaling of production and consumption—the contraction of
economies—arguing that overconsumption lies at the root of long term
environmental issues and social inequalities…
(they) aim to maximize happiness and well-being through non-consumptive
means—sharing work, consuming less, while devoting more time to art,
music, family, nature, culture and community.
(Larson-Walker; 2014)
(SCORAI, 2016)
Thank You
Queries and Suggestions
E-mails:
happyhippu@gmail.com,
hippu@irma.ac.in
Lecture topic
What is Development? – Changing Paradigms
PRM Course
Development Theory

Recap
• Different notions of development
- traditional (income, GDP), social modernization, Sen’s capability approach,
Bhutan’s GNH
- Sen’s flute example (utilitarian, egalitarian, libertarian)
• Shifts in approach to development – human dev.; sustainable dev.
• Limitations of monetary measures of development

blind to: ‘goods’ and ‘bads’; social and environmental concerns; depletion of
natural capital; non-market activities; inequality; leisure (labor supply curve)
• Degrowth: over consumption
doubts/clarifications?
Human development paradigm
Sen’s capability approach
Importance of ‘ends’
related example: Dally’s continuum (Dally, 1973)
Not a new finding
Another belief which harmonizes with our account is that the happy man
lives well and does well; for we have practically defined happiness as a
sort of good life and good action.
(Aristotle, 350 BC)
Ubuntu (African philosophy)

Human development Paradigm
Cont…
Daly’s Continuum
It relates natural wealth

to ultimate human
purpose through
‘technology’, ‘economics’,
‘politics’ and ‘ethics’, by
integrating means and
ends
Dally (1973); Meadows (1998)
Human Development Paradigm Cont…
“Africans have a thing called ubuntu. It is

about the essence of being human, it is
part of the gift that Africa will give the
world. It embraces hospitality, caring
about others, being willing to go the
extra mile for the sake of another.
We believe that a person is a person through other

persons, that my humanity is caught up, bound up,
inextricably, with yours. When I dehumanize you, I
inexorably dehumanize myself. The solitary human
being is a contradiction in terms. Therefore you
seek to work for the common good because your
humanity comes into its own in community, in
belonging.”
— Archbishop Desmond Tutu
Cont…
Pluralistic understanding of well-being (Sen, 1987)
“Capabilities are the abilities to do certain things or to achieve desired

states of being. They are empowerment, the power to obtain what you
desire, utilize what you obtain in the way that you desire, and be who you
want to be. Goods, on the other hand, are merely things that you
possess.”
(Stanton, 2007)
Cont…
Definition from human development paradigm:
'to lead long and healthy lives, to be knowledgeable, to have access to

the resources needed for a decent standard of living and to be able to
participate in the life of the community.'
(UNDP, 2001)
Definition as an enabling framework:
…“the capacity of economic, political and social systems to provide

the circumstances for that well-being on a sustainable, long-term
basis.”
(Barder, 2012)
human-centric
“Progress in the development index has come at the cost of global
warming.”
(Togtokh, C., Time to stop celebrating the polluters, Nature, 429, 2011)
Sustainable Development Paradigm
Notion of Sustainable Development
Different (possibly competing) goals
Multiple definitions (anthropocentric endeavour)
Overuse of resources by people Limits to growth

IUCN (1980) – World Conservation Strategy – integration of conservation and
development
Cont...
Brundtland Commission report of 1987
inter- and intra-generation equity
“…development that does not require resources beyond its
environmental capacity, is equitable, promotes social justice, and is
created through inclusive decision-making procedures” (Jenks, 2000)
Sustainable development ~ Policy
What is to be made sustainable?

Produced capital, human capital, and natural resources (Ruta and Hamilton, 2007)
Weak sustainability and strong sustainability

Cont...
(adapted from SoEAC, 1996)

Cont...
SYSTEMS FRAMEWORK
Human development
Cont...
Bhutan’s GNH
(CBS, 2012)
Going back to Sen’s flute example
Changing the flute to scholarship on an infectious disease
Changing the flute to fruit/food
Changing the flute to party ticket in a safe constituency

(Mishra, 2006)
Lecture topic
Human Development and Capability Approach
PRM Course
Development Theory

Income vs. human choices
• Shift from the conventional notion (that had a wrong objective)
“Any measure that values gun several hundred times more than a
bottle of milk is bound to raise serious questions about its relevance
on human progress” (Haq, 1995)
• GDP/GNP - was wrongly identified as end

Important means to expansion of freedom (Sen, 1999)
• Two changes -
• attention changes from economy to person
• attention changes from money to what people could do or be
(Alkire and Deneulin 2009)
Ends and means of development
• Traditional way of looking at development
- HRD
- Human welfare – only beneficiaries
• Human beings are both ends and means
• Freedoms are both primary aims and principal means to development

Development as freedom
“Ends” matter
Focus on freedoms – as that’s what development advances
Concentrate on that end or objective – rather than some of the means
Development – removal / reduction of unfreedoms
Inability to satisfy hunger

Inability to treat for illness
Inability to be adequately clothed

Inability to have clean water, sanitation
Lack of social arrangements
Denial of political/civil rights
Choices can be income-independent
Country need not be rich to afford democracy
Family need not be affluent to recognize gender equality
The use that people make of wealth is important - not the wealth
itself
Freedom has both constitutive and instrumental role

Constitutive role
Intrinsic value – for example: health and education
(Sen, 1999)
Instrumental role
Role of markets
Market for economic growth and progress - a derived benefit
Market’s fundamental feature - freedom of exchange and transaction

as a part of basic liberties that people have reason to value
Bonded labour – rejection of freedom to participate in labor market
“Development as freedom” approach – broader and more inclusive

perspective to evaluate market
Freedom to enter markets is a significant contribution to development

• Freedom and capabilities – as end objective
• there is overlap – across the approaches (conventional and HD)

(Alkire and Deneulin, 2009)
• Both ends and means
Thank You
E-mails:
hippu@irma.ac.in
Lecture topic
PRM Course
Development Theory

Recap
• HD paradigm– Pluralistic understanding of well-being; Daly’s continuum
Philosophical underpinning – Aristotle (happy man), Ubuntu (co-existence),
Gandhi (collective morality), King (justice); Mill (democracy); 8th Century BC
Sanskrit Manuscript: “What should I do with wealth that not make me immortal”
UNDP’s HDI initiative

- Limitation: human-centric (Togtokh, 2011)
• SD paradigm– IUCN report; 3 dimensions; inter- and intra-generation equity;
Weak and strong sustainability; Economic efficiency, social wellbeing, and
Ecological acceptability
• Bhutan’s GNH • Variations to Sen’s flute exmaple
Human development and Capability approach

human beings – as both ends and means; so is their capabilities and freedoms
(both constitutive and instrumental role)
Intrinsic value of health; education; market doubts/clarifications?
Linkages of unfreedoms
Illustration – Economic unfreedom can make people prey in violation

of other kinds of freedom
Economic Social
unfreedom unfreedom
(Sen, 1999)
Development as freedom Cont…
Linkages of freedoms
Exercise of freedom is mediated by values; values are influenced by

public discussions and social interactions – which are an outcome of
participatory freedom.
Political freedom promote economic security
Social opportunities facilitate economic participation

(Sen, 1999)
two concepts – liberty and equality
An Inspiration to Human Development Paradigm
The Humanist Revolution (Stanton, 2007)
Rawls theory of justice (Rawls, 1971)
social primary goods
“Original position” under veil of ignorance
(No knowledge of future; History has no influence)
Two principles
1. Equal basic liberties
Each person has the same indefeasible claim to a fully adequate
scheme of equal basic liberties, which is compatible to all
2. Social and economic inequalities must satisfy two conditions

First, positions open to all under conditions of fair equality of opportunity
Second, they are to be the greatest benefit of least advantage
member of the society: difference principle (maximin rule)
HDI was born of the humanist revolution.
Cont…
Haq’s four principles of HD
• Equity
Equal opportunities
Rawls’ difference principle
• Efficiency
Optimal use of existing resources
Least cost method of reaching goals
• Participation
Decentralization
• Sustainability
Environmental, financial, social (cultural liberty, diversity)
Concepts Cont…
Functionings
“the various things the person may value being or doing”
(Sen, 1999)
“Functioning’s are valuable activities and states that constitute

people’s well being”
Capability
“Capability is a vector of functioning’s, reflecting the person’s freedom

to lead one type of life or another to choose from possible livings”.
(Sen, 1992)
“Capabilities are the substantive freedoms he or she, enjoys
to lead the kind of life he, or she, has reason to value. (Sen, 1999)
Agency a person’s ability to pursue and realize goals that s/he values and has
reason to value. (Alkire and Deneulin 2009)
more concepts
• Means and ends
• Agency and empowerment

The people have to be seen, in this perspective, as being actively involved -
given the opportunity - in shaping their own destiny, and not just as passive
recipients of the fruits of cunning development programs.
(Sen, 1999)
Thus, agency and expansion of freedom go hand in hand. In order to be

agents of their own lives, people need the freedom to be educated, to speak
in public without fear, or have freedom of expression and association.
How human lives can be made better – the evaluative aspect

How betterment can be brought– the agency aspect
Cont…
Connections with other approaches of development
resources capacity actions utility
Where to focus and why?

HDI – the old (pre 2010)
3 dimensions –
1. A long and healthy life Life Expectancy at birth h
2. Knowledge Adult literary rate (2/3)‫‏‬
e
Gross enrolment ratio (1/3)‫‏‬
3. Ability to achieve decent

GDP per capita y
standard living (PPP)
0 ≤ h, e, y ≤ 1 HDILA = 1/3 (h) + 1/3 (e) + 1/3 (y)
10
10
HDI – the new (since 2010)
3 dimensions –
1. A long and healthy life Life Expectancy at birth h
2. Knowledge Mean years of schooling: adults‫‏‬
e
Expected years of schooling: children‫‏‬
3. Ability to achieve decent

GNI per capita y
standard living (PPP)
0 ≤ h, e, y ≤ 1 HDIGM = (h * e * y)1/3
11
11
Human Development Paradigm
Cont…
• HDI was Lucky – speedy applause for UNDP’s HDR (Haq’s brainchild)
(Sen, 2000)
“What must have appeared to many in the United Nations

system as a rather eccentric plan of an independent-minded
Pakistani economist has become a central component of critical
attention in the world of communication and public discourse
(Sen, 2000)
Reasoning for the success

Why Human Development and Capabilities?
Pluralistic conception/framework
‘human development’ accounting involves a systematic examination of a

wealth of information about how human beings in each society live
(including their state of education and health care, among other
variables).
“issue of plurality and openness to multiple concerns is central to the

success of the exercise” (Sen, 2000)
Utilitarianism and Single-mindedness/oneness
Mill’s dilemma, one measure: rights vs. happiness

“The utilitarian emperor offered small native kingdoms, under strict
viceregal supervision, to advocates of freedom, rights, equal treatment
and many other putative claimants to ethical authority.”
Rawls contribution (Sen, 2000)
Cont…
Development and mono-concentration
Income: parallel to utility
“Riding initially as a kind of younger brother of utility, the concept of real

income had managed to get a very special status in applied work in
development economics”
(Sen, 2000)
Plural concerns on development

HDI: broad and practical; flexible
Captured the imagination of multiple concerns: basic-needs; hunger;
epidemics; disparities; social justice; quality of life
“If the idea of human development had a rapid acceptance, this was made
possible by the skill — ultimately Mahbub ul Haq’s skill — in coordinating
discontent and in weaving them together into a rival and flexible format.”
(Sen, 2000)
Cont…
Plural concerns on development
HDI: broad and practical; flexible
“Supporting the intellectual basis of well-informed public discussion is

one of the main glories of the human development enterprise”. (Sen, 2000)
“an incompletely theorized agreement” (Sen, 2000)

“Here we have a broad framework; if you want something to be included in
this list, which may deserve a table in the Human Development Report
(and with incredible luck, may even be considered for inclusion in one of
the indices like the Human Development Index, or the Human Poverty
Index), tell us what, and explain why it must Žgure in this accounting. We
will listen”
(Sen, 2000)
Cont…
Decades of HD (Sen, 2000)
Lessons for future
(i) Not too much emphasis on HDI, but plurality
(ii) Debates must be on inclusion of other dimensions in HDI
(iii) Grounded to reality
(iv) Political freedom – accountability and sharing of responsibility

(Sen, 2000)
“…his open- minded approach, his scepticism, and his perpetual
willingness to listen to new suggestions” (Sen, 2000)
“And, furthermore, the world itself is changing even as we look at it and report on
it. It is this diverse and dynamic reality on which the enterprise of human
development has to concentrate. It is a stream, not a stagnant pool.”
(Sen, 2000)
Thank You
E-mails:
hippu@irma.ac.in
Lecture topic
Human development and Capability approach
PRM Course
Development Theory

Dt. 24 November 2020
Recap
• Linkages among freedoms and unfreedoms
• Rawls Theory of Justice (Original position); Social primary goods)

Equal basic liberties; socio-economic inequalities (equal
opportunities; difference principle)
• Haq’s four principles of human development – Equity, efficiency, participation,

and sustainability (environmental, financial, social)
• Concepts – Functionings, capability, and agency (empowerment)
- Evaluative and agency aspect of human development
• Comparisons of different approaches of development (alternative focus on

resources, capacity, actions, and utility)
• Basics of HDI measure: pre-2010; current status
• Reasoning the success of HD paradigm and HDI (Sen, 2000)
doubts/clarifications?
Lecture topic
Poverty
PRM Course
Development Theory

Dt. 24 November, 2020
Poverty – concepts and measurements
Reference
Ray D.; 1998. Poverty and Undernutrition, Chapter 8, Development Economics;
Princeton University Press
Thirlwall A.P.; 2006. Development Gap and Measurement of Poverty, Chapter 2,

Growth and Development; 8th Edition, Palgrave McMillan
Poverty - concepts
Multi-dimensional deprivations
Many facets of poverty illiteracy, under nutrition, ill-health,

lack of hope (limiting one’s dream)
Removal of poverty: fundamental goal of Development Economics
Layers of inequality
Poor countries, poor states, poor regions, intra-household poverty
Poverty concepts
Cont…
Temporary vs. chronic poverty
structural- chronic
bad economic shocks - temporary
expenditure – better measure than income
Absolute vs. relative poverty
common (nutrition) and varying elements (may be a TV)
confuses with inequality

Poverty concepts
Cont…
Household poverty –
Discrimination: unequal sharing of poverty
to make one member more productive, life-boat ethic
(Hardin, 1974)
resource ~ work capacity
socio-cultural factors – gender, old-age
Family size
small vs. large family (fixed vs. varying expenses)
Poverty and size of family – cause and effect
Large family – poverty may be overstated (scale factor, children)
Poverty concepts
Cont…
Poverty Line
Threshold: Minimum level of ‘acceptable’ economic participation
Critiques of poverty line (Nathan, 2014)
1) Discrete categorization: ‘poor’ & ‘non-poor’ - not reflective of reality
Focus axiom
Poverty measure is independent of the income distribution of non-poor
Sen (1976, 1981)
Implicit division (simplicity!)
2) Bottom heavy society: highly sensitive to change

$1.25 a day (PPP) : 32.67%; $2 a day (PPP) : 68.72% World Bank (2010)
3) Criticized as line of starvation Ronald (2005), Guruswamy and Abraham (2006)
Rs. 38.4 in urban Gujarat RBI (2012)

Poverty measurements
Head Count Ratio
Definition
Proportion of population classified as poor
Expression
No. of poor m 1
HCR =    I ( yi  z ) I =1 if condition
Total population n n satisfies,
otherwise 0.
Graphical presentation of HCR
Numerical Example
Head Count Ratio
Advantages
Simple to understand, hence popularly used
Limitations
Insensitive to depth or degree of poverty
reduce the money of the poor – HCR does not change
Insensitive to the distribution of poverty
among poor – money transfers from poor to relatively less
poor – HCR does not change
poverty gap ratio
Definition
Average poverty gap as a proportion of poverty line
(above poverty line people have poverty gap zero)
Alternate name: intensity, depth or degree of poverty
Expression
Sum of poverty gap as proprtionof povertyline income
PGR =
Total population
1 n  z  yi  1 n  yi 
     1  
n i 1  z  n i 1  z
Graphical presentation of PGR

Numerical Example – per capita cost of eliminating poverty
poverty gap ratio
Interpretation
Minimum cost for elimination of poverty: fill the poverty gap
q
   z  yi  Perfect targeting
i 1
Maximum cost for elimination of poverty: give everybody z
 n z No targeting
Ratio of minimum to maximum cost for poverty elimination

poverty gap ratio
Advantages
Accounts for depth or degree of poverty
reduce the money of the poor – PGR increases
Unlike HCR, no discontinuity
Limitations
Insensitive to the distribution of poverty
poor – PGR does not change
squared poverty gap ratio
Definition
Average square of poverty gap as a proportion of poverty line
(above poverty line people have poverty gap zero)
Alternate name: distribution or severity of poverty.
Expression
Sum of square of poverty gap as proprtionof povertyline income
SPGR=
Total population
2
1 q  z  yi 
2
1 q  yi 
     1  
n i 1  z  n i 1  z
Interpretation
Weighted average
2
1 m  yi  1 m  yi  yi 
SPGR   1     1  1  
n i 1  z n i 1  z  z
Weighted by itself: larger the poverty gap, larger is the weight
Numerical example
Advantages
Accounts for depth or degree of poverty
reduce the money of the poor – PGI increases
Accounts for the distribution of poverty

poor – HCR, PGR does not change
No discontinuity
Limitations
Calculation intensive
extent, depth, & distribution
FGT (Foster-Green-Thorbecke) measure

1 q  z  yi 
P    
n i 1  z 
For α=0, P0 = HCR
1 q  yi 
For α=1, P1 = PGI =  1  
n i 1  z
2
1 q  yi 
For α=2, P2 = SGPI =  1  
n i 1  z
(Foster et al.,1984)
extent, depth, & distribution
FGT (Foster-Green-Thorbecke) measure

For different α
Poverty distribution – policy imperatives
Scenario 1 Scenario 2
0.1 0.2 0.7 0.8
PL
attention goes to the poorest of the poor

Multidimensional poverty
Different dimensions of deprivation, income is not the only dimensions
 Select dimensions
 Find the scope for componentization of dimensions
 Identify indicators
 Select weights for dimensions, components and indicators
 Find cut off for each indicator/component/dimension
 Criteria for identifying poor
 Evaluate poverty based on Measures for Multi dimensional Poverty Index
(MPI)
Poverty Criteria
 Union: poor in at least one dimension

If all the dimensions are required to be free from poverty
A rich may be poor for other attributes
 Intersection: poor in all dimensions
If attainment in any of the dimension is enough
A poor may be turn out to be non-poor because of higher
attainment in one of the attributes
 Intermediate
Simple Example
Society with 5 individuals: A, B, C, D and E

4 dimensions of poverty: health (h), education (e), income (y), amenities (a)
All the dimensions have one representative indicator
Heath (h): Nutrition level (Food intake) values: 0 to 100 Cut off: 50
Education (e): education level, values: illiterate:0, primary:0.2, secondary:0.4
matriculate:0.6, intermediate:0.8 and graduate and above:1 Cut off: 0.6
income (y): income values: 1000 to 10000 Cut off: 3000
amenities (a): housing condition values: no house:0, kacha house:0.5,
semi pucca house:0.75 and pucca house: 1.0 Cut off: 0.75
Alkire and Foster (2009)
Simple Example
Inde Dimensions Poverty/deprivation Cou Poverty criteria

x h e y a h e y a nt U ∩ d=2
A 80 Sec. 9000 Pucca 0 1 0 0 1 1 0 0
B 30 Illite 2500 Kucha 1 1 1 1 4 1 1 1

rate
C 40 Inter. 0 Pucca 1 0 1 0 2 1 0 1
D 100 Prim 6500 Semi- 0 1 0 1 2 1 0 1

pucca
ary
E 50 Grad 8000 Pucca 0 0 0 0 0 0 0 0
.
Cutof 50 Mat. 3000 Semi-
pucca HCR 4/5 1/5 3/5
f
Lecture topic
Gender and development
PRM Course
Development Theory

Dt. 23 November, 2020
Gender and Development
Reference
Jean Dereze and Amartya Sen; 1992. Gender Inequality and Women Agency,
Chapter 7, India: Development and Participation; Oxford University Press
Anand S., Sen. A.; 1995. Gender Inequality in Human Development: Theories
and Measurement, 2.7, in Fukuda-Parr, S. and Shiva Kumar, A.K. Readings in
Human Development; Oxford University Press
Gender biases
Manifestations:
Education
Nutrition, Health, Survival
India’s Female to Male ratio (FMR) is lower than Europe, North America
and sub-Saharan Africa
Differences within the household
Stronger gender: Women are biologically more immune (than the male-
counterpart) to disease and death in all age group.
Women outnumber men in Europe & North America; FMR =1.05 (UNPD, 1999)
https://www.worldometers.info/demographics/demographics-of-northern-america/
https://www.worldometers.info/demographics/demographics-of-europe/
Gender biases
Gender biases
Gender biases
FMR for developing world is low: North Africa – 0.98, West Asia – 0.9
Bangladesh – 0.95, China – 0.94, India and Pakistan – 0.93
(among the lowest in the world)
“Missing women”
Asia and North Africa: 100 million women
Intra-India Gender biases
Sex-ratio in different states: Census (2011)
Low: Haryana: 879, J&K: 889; Punjab: 895; (North-western States)
High: Kerala: 1084 Tamil Nadu: 996, AP: 993, Karnataka: 973 (Southern
States)
Consistent with gender bias characteristics of the region:

North-western:
• practice of female seclusion
• low female labour force participation
• large gender gap in literacy rates
• extremely restricted female property rights
• strong boy preference in fertility decisions
• wide spread neglect of female children
• drastic separation of married women from her natal family
For all these indicators South and Eastern States do better.
North-west and
South-east
Target map (2019)

Kerala:
• expansion of female literacy
• prominence of women in socio cultural activities
• Matriliny
Representation of women in Assembly: Low

Two misconceptions
FIRST: Hidden Female Infanticide as Main cause: Not captured in

Data and report
Actual State of the affair is the following:

Infant mortality rates are same for male and female
Mortality for 1-4 age group for female is 63% higher than that of male
for some States it is twice high (GoI, 1998)
Preferential treatment of boys and neglect of female children in intra-

household allocation
Two misconceptions
SECOND: Muslim influence: North-west States closer to Muslim world-

hence under Muslim influence
Actual State of the affair is the following:
Kerala highest FMR: highest proportion of Muslim in India after J&K; Assam;
and WB
Punjab lowest FMR: lowest proportion of Muslim (1%), Haryana (4%)

Roots of Pakistan’s low status is linked to ‘historical influence of traditions of
Hindu majority in Undivided India’ (Shah, 1986)
Regional contrast is far more striking than religious identity

Ratio of female child mortality to male child mortality:
Hindu ~ Muslim
Source: Drèze and Sen (2002)

Thank You
E-mails:
hippu@irma.ac.in
Lecture topic
Inequality and Development
PRM Course
Development Theory

Dt. 08 December 2020
Recap
Poverty module
Concepts: many facets; Measurements:
temporary vs. chronic; Expenditure vs. income
absolute vs. relative;
Critiques to the notion of poverty
hh poverty: life-boat ethic; line
hh size
Measures: HCR, PGR, SPGR (FGT measures)
Multi-dimensional poverty measure

H: Fraction of multi-dimensional poor
Gender module
Concepts: stronger gender
age-wise sex-ratio (contrast between developed and developing economies)
India’s regional divide in Gender justice – North-West vs. South-East
Two misconceptions; Sanskritization doubts/clarifications?
Lecture topic
Poverty
PRM Course
Development Theory

Dt. 08 December, 2020
Simple Example
Indicator Weight Person A Person B Person C

Child Mortality 1/6 1 1 0
Health
Nutrition 1/6 0 1 0
Years of schooling 1/6 1 0 1
Education
School attendance 1/6 0 0 0
Cooking fuel 1/18 0 1 1
Sanitation 1/18 1 0 0
Living Drinking Water 1/18 0 1 0
Standards Electricity 1/18 0 1 1
Housing 1/18 0 0 1
Assets 1/18 1 0 1
Weighted score 0.44 0.5 0.38
M=2/3
MPI poor MPI poor Not MPI poor
A=(0.5+0.44)/2 Status (0.4=cut off)
(≥ 0.4) (≥ 0.4) (<0.4)
MPI=M*A
Lecture topic
Gender and development
PRM Course
Development Theory

Dt. 08 December 2020
Gender biases
Age in
years
Population in thousands
India (ProximityOne, 2020)
Gender biases
Age in
years
Population in thousands
(PopulationPyramid, 2020)
Gender biases
Population Pyramid
https://www.populationpyramid.net/
Child Sex-ratio India
(Census of India, 2011)

Gender and Caste
Pre-independence: FMR is higher among ‘lower’ caste
NOT so now
FMR 1991- SC: 922 Overall: 927
Copycat: Following the footsteps of higher caste
Martial caste of North India: Fierce patriarchy

Female infanticide, Child marriage,
Seclusion, Dowry, Sati, Levirate,
Polygamy etc.
Patriarchal norms of the higher castes are spread to other castes like a
‘model to be followed’
Movement from a ‘bride price’ to dowry
Sanskritization at work
Gender and Caste
Caste-wise FMR UP: 1901,1981
Source: Census of India
UP: FMR 1961- SC: 941 Overall: 909; 1991- SC: 877 Overall: 879
India FMR 1961- SC: 957 Overall: 941; 1991- SC: 922 Overall: 927
Gender and Economy
Higher level of poverty – a higher FMR
Poor: Partnership aspect of Gender relation

Rich: More dependent and of symbolic position
Economic growth leading to intensification of gender bias
Achieving greater gender equity – beyond economic

(Punjab and Haryana)
Lecture topic
PRM Course
Development Theory

Dt. 07 December, 2020
Reference
Ray D.; 1998. Economic Inequality, Chapter 6, Development Economics;
Princeton University Press
Ray D.; 1998. Inequality and Development: Interconnections, Chapter 7,

Development Economics; Princeton University Press
Notion of inequality
Gini coefficient
Gini Coefficient –
A/(A+B)
B
Notion of inequality
Dalton’s Principle
If one income distribution can be achieved from another by constructing a

sequence of regressive transfers, then the former distribution must be
deemed more unequal than the latter.
Inequality ~ Income
Kuznets Inverted U hypothesis

The Kuznets/inverted-U hypothesis says that income inequality should follow an
inverse-U shape along the development process, first rising with industrialization
and then decline
Crosssectional
- Inequality for developing country will be higher than developed counterparts
- Kuznet’s study in 1955 and 1963 (18 countries)
- Paukert (1993) (56 countries)
- Deininger and Squire(1996)

Testing Kuznet Hypothesis
Paukert (1973)
56 countries cross-section data
0.55
0.5
Gini coefficient
0.45
0.4
0.35
0.3
GDP Percapita (1965 US$ )

Testing Kuznet Hypothesis
Deininger and Squire(1996)
All countries
whose data
are available
Inequality ~ Income
- Economic development is fundamentally “sequential” and “uneven”
Everybody does not get benefit at the same time; development pull up
certain groups first and leave others to catch up.
Tolerance to inequality – TUNNEL EFFECT

Kuznets Hypothesis
Income of a society increases on three accounts -
Steady sequence
Uneven change (inequality creating)
Compensatory change
Inverted-U: uneven change from low to medium; and

compensatory change medium to high
Kuznets Hypothesis
Economic development: People from relatively lower to relatively
higher sector of economy
Technical progress Initially benefits small industrial sector – Uneven

(at low level of income)
Biased against unskilled labourer
Gain to the minority; but create opportunity for many
Ultimately finds the way to all

Inverted U – to be dealt with care
Inclusion of other variables may vanish the inverted-U relationship.
Structural differences across countries or regions may create the

illusion of an inverted-U, when indeed there is no such
relationship.
When countries are examined separately, there is some evidence

of an inverted-U, but also some evidence of an direct U and some
evidence that inequality falls with income.
Inequality and Savings
Is Inequality good or bad for saving?
Two scenarios
A – Individual (1) income 4,00,000 Rs per year
Individual (2) income 1,00,000 Rs per year
B – Individual (1) income 2,50,000 Rs per year
Individual (2) income 2,50,000 Rs per year
As society moves from A to B – impact on saving

Increasing marginal saving rate
Reducing inequality reduces saving

Decreasing marginal saving rate
Reducing inequality increases saving

How does savings change with income?
Reducing inequality increases saving
Subsistence
Conspicuous
Aspiration and saving

How does savings change with income?
In a poor country
Inequality No persons Saving

remains
worth saving
Medium income country – the situation may be reversed
Inequality Creation of Saving

Middle Class
Impact of saving and income on inequality
- Important – where from one has started: low inequality or high
low inequality Impact of Saving will not affect
high inequality Saving would increase inequality
b/w Poor and Non-Poor
As gap b/w Higher Middle and

High would blur
Inequality and Growth
High economic inequality might retard economic growth by setting up political
demands for redistribution. Land reform, Confiscatory taxes on wealth
Taxes on incremental wealth
Incentive to accumulate investment

wealth and growth
Empirical evidence
high levels of initial inequality retard subsequent economic growth
Inequality begets inequality
Inequality may persist if demand for rich is supplied by rich.
Luxurious products are capital intensive
If labor intensive, reduction in inequality
Trickle down effect will not always work
Increase in government expenditure

reduces inequality as government services were significantly
intensive in unskilled labour
- evidence of US increasing equality during Great depression and War period
Thank You
E-mails:
hippu@irma.ac.in
Classical Growth Theories
Smith, Malthus and Ricardo

Historical Background
• Industrial Revolution (1760 to 1840)
– Manufacturing processes
– Technological innovation
• Colonialism
– Resource, land, cheap inputs and markets
• Rigid division of Society
– Rigid division of society between capitalists
(including landlords) and labours
– Absence of middle class
Adam Smith
• Father of modern economics

• Scottish
• 1723-90
• The Theory of Moral Sentiments (1759)
– Sympathy for others
• An Inquiry into the Nature and Causes of the
Wealth of Nations (1776)
– Role of self interest
– Giving the colonies their independence and develop
and maintain free trade
Reflections from Industrial Revolution
One man draws out the wire, another straights it, a third cuts
it, a fourth points it, a fifth grinds it at the top for receiving the
head; to make the head requires two or three distinct
operations; to put it on is a peculiar business, to whiten the
pins is another; it is even a trade by itself to put them into the
paper; and the important business of making a pin is, in this
manner, divided into about eighteen distinct operations.... [An
average factory of ten workers] could make among them
upwards of forty-eight thousand pins in a day. Each person,
therefore...might be considered as making four thousand eight
hundred pins in a day. But if they had all worked separately
and independently, and without any of them having been
educated to this peculiar business, they certainly could not
each of them have made twenty, perhaps not one pin in a day.
(The Wealth of Nations, p. 10)
Increasing Returns
• Division of labour beneficial
– Increase of dexterity: learning by doing
– Savings of time lost in passing from one species of
work to other
– Higher labour productivity
– Increasing returns
• Increasing returns Division of Labour and
– Industrial activities Increasing returns are two
– Rich countries important notion
• Diminishing returns contributed by Smith
– Land based activity
– Poor countries Division of labour is limited
by extent of market
Process of Growth
Capital accumulation
Division of labour
Increasing returns
Growth Higher labour productivity

????
process Say’s Law: Supply
Greater scope for capital accumulation
cumulative creates its own
More use of machinery / cost saving demand
machinery
More output
Larger market
profit
Larger savings
• Savings are invested in full in machines and
land
• Only capitalist and landlords are capable to
save and invest
• Labour gets wage funds
– Amount necessary for subsistence
• Reciprocal Model
– Balanced growth between agriculture and
manufacturing is essential
Banancing
• Supply side
– Agricultural surplus required to sustain industrial
population
– increase in productivity of agriculture supplies
labour to industry
• Demand side
– Agricultural surplus gives rise to demand of
industrial products
Limits to growth
• Desire for investment falls if profit falls
• Profits falls as
– competition between capitalists increases
– wage rise
• Profits rise as
– New investment opportunities
Policy Implications
• Invisible hands
– Each individual is guided by invisible hands which
guided market mechanism
– If individuals are set free, will seek to maximize
own wealth, therefore all individuals , if left free,
will maximize aggregate wealth
• Free trade
• Laissez-faire
• No government intervention
Underdeveloped Countries
• Small size of markets
• Capacity to save and investment low
• Low growth rate
Income elasticity of global trade
The ghost of Malthus
• Thomas Malthus (1766-1834)
• English
• Essay of the Principal of Population (1798)
– Constant tendency in all animal life to increase
beyond the nourishment prepared for it
– Population increases in geometrical ratio but
subsistence increase in arithmetical ratio
Growth of population 1, 2, 4, 8, 16, 32, 64
Growth of subsistence 1, 2, 3, 4, 5, 6, 7
Pessimism
• Identified problem of effective demand
• Effective demand must grow in line with
production potential
• Per capita income around subsistence
• Increase in per capita income through
technological progress
– More births
– Reduces per capita income
• Imbalance between savings and investment
– Savings of landlords may exceed demand for fund by
the capitalist for planned investment
• Low demand for product due to low per capita income
Other Pessimists
• Low level equilibrium trap in 1956
– Richard R. Nelson
• Big push Model in 1943
– Paul Rosenstein-Rodan
• Dismal Science????
Implications
• Preventive checks
– Sexual abstinence or use of contraception
• Positive (natural) checks
– Pestilence (epidemic), disease and famine
• Population growth was resisted in many parts
of the world and agricultural production
increased more than arithmetic progression
David Ricardo (1772-1823)
• Production of only corn

• Three groups
Landlords Capitalists Labour
Wages
Rent Profit
Economic Rent: payment to a factor of production in excess of the cost

needed to bring that factor into production
Economic Rent
People first started cultivating
in A and occupied it
A B
B is relatively unproductive as
compared to A
Population growth takes

place
Difference between
A produces corn of 35 quintals – owner is present
average and
B produces corn of 30 quintals – free land marginal product of
land
To cultivate A, the tenant pays 5 quintals to owner of A
Otherwise use B
Economic rent: 5 quintals
Financial Times Stock Exchange
Corn
Total Output
wage
L* Labour
L
Fixed proportion of labour and land

Stationary state
• Profit in agriculture falls
• Capital shift to industry Problem of
• No limit to capital deployment effective demand
– Say’s law not identified
• Wage fund rises Say’s Law
• Population rises
• Wage rise in terms of food (corn price rise)
• Rate of profit in industry falls
• Stationary state
Implication
• Import cheap food (raw material) if land is
constraining and export manufacturing
product
– Delay stationary state
• Abolition of Corn Law 1846
– Benefit industrialists
– Affected farmers
• famous PL 480 wheat import deal with US was
signed by India in 1956
Combining Classical Thoeries
Business Cycle and Stationary State
Higher wage
fund
Growth of
population
and labour
Technological
improvement
Decreasing returns
Higher and lower profit
Higher lower
output investment
investment
Lower
output
Higherlower
profitprofit
expectation
expectation
Missing Demand Side
Say’s Law
• Jean-Baptiste Say (1767-1832)
• French Economist
• Idea of Say’s Law in 1803
– Treatise on Political Economy
• Supply creates its own demand
– ”A product is no sooner created, than it, from that
instant, affords a market for other products to the full
extent of its own value”
– “As each of us can only purchase the productions of
others with his own productions – as the value we can
buy is equal to the value we can produce, the more men
can produce, the more they will purchase”
– No general glut of product
Keynesian Ideas
• Say’s Law was challenges during
Great Depression
– 25% unemployment in Unites States
• John Maynard Keynes argued in
1936 that Say's law is not true Great Depression
– Demand determines overall economic
• severe worldwide economic
activity depression that took place
• Keynes (1883-1946) - British during the 1930s
• Keynesian economics explains how• longest, deepest, and most
in the short run, and especially widespread depression of the
during recessions, economic 20th century
output is strongly influenced • US Stock market crash on
by aggregate demand October 29, 1929 (known as
– Keynesian Multiplier Black Tuesday)
• Lasted till World War II
Idea of “Creative Destruction”
Joseph Schumpeter (1883-1950)
• Austrian American - professor at Harvard University in 1932
• When innovations or changes (economic, social, political and technical)
take place in the economy, the stationary equilibrium or circular flow is
displaced and the process of development starts
• Schumpeter’s model starts with the breaking of circular flow with an
innovation in the form of a new product.
• Entrepreneur is the key figure in Schumpeter’s analysis of the process
of development/ breaking of circular flow
• Entrepreneurs is to
– Appreciate the possibilities of innovation
– Overcome the socio-psychological barriers against the introduction of
new things,
– Direct the means of production into new channels
– Persuade the banker to provide him with necessary finance for
innovations.
– Induce other producers in his branch of activity for taking risk.
– Create an environment conducive to the satisfaction of wants as the
normal motive.
– Provide leadership and
– Take high degree of risk in the economic world.
Creative destruction
• New production units replace outdated ones
Post-Keynesian Model of Economic Growth:
Harrod-Domar Models
• help analyse the business cycle
• explain economic growth
Demand
Income
Investment Balance
steady growth
Increase through
productive adjustment of
Supply
capacity supply of
demand for
Increase capital
Savings
investment
in long Neutral
term technology
Bank credit
• goods market equilibrium:
• sY = I s = I/Y
• is income, I investment, s the marginal propensity to save
• I/Y = (I/K)(K/Y), K is capital stock
• (I/K) = g, rate of capacity growth, rate of capital
accumulation
• (K/Y) = v, capital output ratio
• g = s/v, s/v is the "warranted growth rate" of output
• Harrodian "knife-edge“
– actual growth is slower than the warranted rate, invest less, low
demand, further lesser actual growth
– Actual growth higher than the warranted rate, invest more, high
demand, shortage of capital more acute
– unless we have demand growth and output growth at exactly the
same rate, i.e., demand is growing at the warranted rate, then the
economy will either grow or collapse indefinitely.
Aggregate demand must grow at the same rate as the economy's output capacity grows
for "steady state" growt
• Low savings is the reason for low economic growth in
underdeveloped countries
• Harrod-Domar followed in First Five Year Plan (1951–1956)
– One sector: aggregates all types of production into a single total
• Mahalanabis model
– Two sector: consumption good and capital good
– emphasis on the possibility that the overall rate of real
investment in the economy might be constrained by the
level of output in the capital goods industry within the
economy.
– overall rate of growth over a given period of time tended
to vary directly with the overall rate of investment in the
economy
– Government expenditure
Solow Model
• due to Robert Solow
• Criticism of Harrod-Domar
– Production under fixed proportion: no possibility
of substituting labour for capital in production
– Unstable balance of growth
Solow Model
• K is no longer fixed:
investment causes it to grow,
depreciation causes it to shrink
• L is no longer fixed:
population growth causes it to grow
• no G or T
The production function
▪ In aggregate terms: Y = F (K, L)
▪ Constant Returns to Scale
▪ Define: y = Y/L = output per worker
k = K/L = capital per worker
▪ y = f(k)
The production function
Output per
worker, y
f(k)
MPK = f(k +1) – f(k)

1
Note: this production function

exhibits diminishing MPK.
Capital per
worker, k
The consumption function
▪ s = the saving rate,
the fraction of income that is saved
(s is an exogenous parameter)
Note: s is the only lowercase variable
that is not equal to
its uppercase version divided by L
▪ Consumption function: c = (1–s)y

(per worker)
Savings and Investment
• Investment = Savings
• Holds for per worker
• Using the results above,
i = sy = sf(k)
Output, consumption, and investment
Output per f(k)

worker, y
c1
y1 sf(k)
i1
k1 Capital per
worker, k
Capital accumulation
The basic idea: Investment increases the capital stock,
depreciation reduces it.
Change in capital stock = investment – depreciation

k = i – k
Since i = sf(k) , this becomes:
k = s f(k) – k
The equation of motion for k
k = s f(k) – k
• The Solow model’s central equation
• Determines behavior of capital over time…
• …which, in turn, determines behavior of
all of the other endogenous variables
because they all depend on k. E.g.,
income per person: y = f(k)
consumption per person: c = (1–s) f(k)
The steady state
k = s f(k) – k
If investment is just enough to cover depreciation
[sf(k) = k ],
then capital per worker will remain constant:
k = 0.
This occurs at one value of k, denoted k*,

called the steady state capital stock.
CHAPTER 7
Economic
The steady state
Investment
and k
depreciation
sf(k)
k* Capital per
worker, k
Moving toward the steady state
Investment
 k = sf(k) − k
and k
depreciation
sf(k)
k
investment
depreciation
k1 k* Capital per
worker, k
Investment
 k = sf(k) − k
and k
depreciation
sf(k)
k
k1 k2 k* Capital per
worker, k
Investment
 k = sf(k) − k
and k
depreciation
sf(k)
k
k2 k3 k* Capital per
worker, k
An increase in the saving rate
An increase in the saving rate raises investment…
…causing k to grow toward a new steady state:
Investment
and k
depreciation s2 f(k)
s1 f(k)
k
k 1* k 2*
Prediction:
• Higher s  higher k*.
• And since y = f(k) ,

higher k*  higher y* .
• Thus, the Solow model predicts that countries with

higher rates of saving and investment
will have higher levels of capital and income per
worker in the long run.
Population growth
• Assume that the population (and labor force)
grow at rate n. (n is exogenous.)
L
= n
L
Break-even investment
• ( + n)k = break-even investment,
the amount of investment necessary
to keep k constant.
• Break-even investment includes:
–  k to replace capital as it wears out
– nk to equip new workers with capital
(Otherwise, k would fall as the existing capital stock
would be spread more thinly over a larger population of
workers.)
The equation of motion for k
• With population growth,
the equation of motion for k is
k = s f(k) − ( + n) k
actual
break-even
investment
investment
The Solow model diagram
Investment,
k = s f(k) − ( +n)k
break-even
investment
( + n ) k
sf(k)
k* Capital per
worker, k
The impact of population growth
Investment,
break-even ( +n2) k
investment
( +n1) k
An increase in n
causes an increase sf(k)
in break-even
investment,
leading to a lower
steady-state level of
k.
k2* k1* Capital per

worker, k
Prediction:
• Higher n  lower k*.
• And since y = f(k) ,

lower k*  lower y*.
• Thus, the Solow model predicts that countries

with higher population growth rates will have
lower levels of capital and income per worker
in the long run.
Implications
• Higher growth in countries with
– Higher savings rate
– Lower population growth
– Improvement in technology
• Lags in the diffusion on knowledge.
– Differences in real income might shrink as poor
countries receive better technology and information
• Efficient allocation of international capital flows,
since the rate of return on capital should be
higher in poorer countries.
– In practice, this is seldom observed
Knowledge on Development:
Conceptual history and approaches
C Shambu Prasad
DP class 8, Dec 23, 2020
Contents
• Introduction
• Introduction to Development Studies
– What is development studies?... Sumner
– Nature of development studies… Robert Potter
• Introducing Assignment 1
– A new development paradigm – Arvind Virmani
• Nonconventional theories of development :
Marxism, Dependency and world systems
• Post-development theories; Gandhi and post-
development
Constitution of the Batch
State No % Cent
Andhra Pradesh 6 2.6
Assam
Bihar
3
9
1.3
4.0
United Colours of
Chandigarh
Chhattisgarh
3
5
1.3
2.2 PRM41 (24)
Delhi 10 4.4
Gujarat 31 13.7
Haryana 13 5.7
Himachal Pradesh 2 0.9
Jammu and Kashmir 1 0.4
Jharkhand 7 3.1
Karnataka 6 2.6
Kerala 11 4.8
Madhya Pradesh 13 5.7
Maharashtra 28 12.3
Meghalaya 1 0.4
Mizoram 1 0.4
Odisha 10 4.4
Rajasthan 15 6.6
Tamil Nadu 9 4.0
Telangana 3 1.3
Uttar Pradesh 25 11.0
Uttarakhand 3 1.3
West Bengal 12 5.3
Multiple meanings of development
What is Development?
Growth, society, better, living,

Life, people, growth, process, economic, society, quality,
people, process, standard, life, social, living, change, increase, basic, improving
quality, change, positive, economic
• Trigger further debate, diversity
• Contested, discussion rather than closure
Development Studies
• Unlike DE, DS is
interdisciplinary in nature,
(sociology, political science
etc.)
• Area studies, third world
studies, international
development
• Young field of study – post
WWII, decolonisation of
1950s- 60s
• ‘Econ’ vs ‘Develops’ early
phase… 18th C anthropology
too
Cross-disciplinary nature of DS
History of DS?
• Intellectual and political context of 1960s and 1970s
• ODI and IDS (1966), 1973 East Anglia- 1st undergrad prog
• Product of the colonial and post-colonial eras.
• India has its own variations https://icssr.org/research-institutes-0
• 1940s – post WWII, Truman’s speech of 1949
• 1950s – reconstruction, liberalising trade, ‘new geography’.. Western, top-
down
• 1960s - European events in 1968 a resurgence of Marxist socio-economic
theory, Revolution was in the air.
• Latin America – ‘dependency theory’ – delink from west, follow alternate
model
– ‘African Socialism’ Nkrumah’s book Neo-colonialism: The Last Stage of
Imperialism (1965)
– Nehru’s leadership of the non-aligned movement together with Gandhi’s
pacifist philosophy and anti-colonial standpoint
– influential civil rights movement in the USA, Vietnam war
History of DS?
• 1970s- Development geography as a sub-discipline, dissatisfaction
with quantitative revolution to more humanistic approaches,
subjectivity of phenomena and knowledge. “another development’
critique of urban-based, top-down, centre-out NC models,
environmental movements
• 1980s – New right and neoconservatism. Neoliberal agenda
(‘Popular capitalism’ & Reaganomics’
• 1990s – ‘postmodernism’ – rejection of meta-theories and meta-
narratives, Eurocentric stand
• 2000s - loss of the central paradigms, new heuristics civil society,
social capital, diversity and risk (Schrumann, 2000); Mixed
economies (Sachs, 2009), Future Positive (Michael Edwards, 1999),
MDGs- SDGs.
Purpose of Development Studies
• Research on development… … seeks to make a difference. This
makes it even more loaded and contested than other kinds of
research. (Mehta et al., 2006: 1)
• Development Studies is research committed to improvement.

Knowledge generation is not an end in itself … An implication of
this is that Development Studies addresses current, actual
problems, focusing on solving them – it tends to be applied and
action – or policy-orientated. (Molteberg and Bergstrøm, 2000: 7)
• Who are we – who am I to intervene in other people’s lives when

we know so little about any life, including our own? (Rahnema,
1997: 395)
Purpose of Development Studies
• Development Studies has been accused in recent years of being
irrelevant, of being hopelessly evolutionary, of being colonial in
intent, of being masculinist, of being dirigiste, and of being a
vehicle for depoliticisation and the extension of bureaucratic state
power. It stands accused of being the source of many of the
problems of the so-called Third World. (Corbridge, 2005: 1)
• Development Studies crucially involves issues of positionality.

Those studying development must be critically aware of their own
position: the ‘viewpoint’ from which they are undertaking their
analyses. It is important to recognize the difference between
studying processes of change as though they are ‘out there’ and
studying processes which we are involved in. (DSA, 2006: 1)
EPW, IJRM, Development in Practice etc.
Audience for DS?
DS community ‘practical thinkers’ and ‘reflective doers’
‘detectives’ (data collection, analysis and interpretation), ‘translators’ (reframing
given ideas for diverse groups) and ‘diplomats’ (negotiation, conﬂict mediation,
deal making) (Bernstein, 2005:, 55).
Readings
• What is development Studies?
Sumner & Tribe
• Development in Practice
1. What is development studies?
(i.e. what is its focus, aim and
approach?)
2. What constitutes rigorous
research in development
studies? (i.e. what are the
characteristics of ‘high quality’
development research?)
• The overall aim of this book is to
address these two questions.
• “Development’ is a concept which is contested both theoretically and
politically, and is inherently both complex and ambiguous … … Recently
[it] has taken on the limited meaning of the practice of development
agencies, especially in aiming at reducing poverty and the Millennium
Development Goals. (Thomas, 2004: 1, 2)
• The vision of the liberation of people and peoples, which animated

development practice in the 1950s and 1960s has been replaced by a
vision of the liberalization of economies. The goal of structural
transformation has been replaced with the goal of spatial integration.… …
The shift to ahistorical performance assessment can be interpreted as a
form of the post-modernization of development policy analysis. (Gore,
2000: 794–5)
• Post-modern approaches… see [poverty and development] as socially

constructed and embedded within certain economic epistemes which
value some assets over others. By revealing the situatedness of such
interpretations of economy and poverty, post-modern approaches look for
alternative value systems so that the poor are not stigmatized and their
spiritual and cultural ‘assets’ are recognized. (Hickey and Mohan, 2003:
38)
• One of the confusions, common through development
literature, is between development as immanent and
unintentional process… … and development as an intentional
activity. (Cowen and Shenton, 1998: 50)
• If development means good change, questions arise about

what is good and what sort of change matters… Any
development agenda is value-laden… … not to consider good
things to do is a tacit surrender to… fatalism. Perhaps the right
course is for each of us to reflect, articulate and share our
own ideas… accepting them as provisional and fallible.
(Chambers, 2004: iii, 1–2)
• Since [development] depend[s] on values and on alternative

conceptions of the good life, there is no uniform or unique
answer. (Kanbur, 2006: 5)
• Positionality
• What are the big changes in development?
• Robert Chambers’s Advice for Life
Knowing Development through Article
Review
• EPW at 50 Documentary Trailer
• https://www.epw.in/journal/2020/50
• https://www.epw.in/review-rural-affairs
• Choose group of 3 by 25th Dec, enter topic
online 27th Dec 10am
• Online review submission through LMS by 31st
– summary in OWN words with a reflection on
your learning about development (750 – 950
words)
Rethinking Development:
Marxian and Dependency
Theory
DT Class 9, Dr C Shambu Prasad
Dec 30 – 31, 2020
Contents
• Beyond … neo-classical
• IIMA mid day meal 2020 survey
• Marx and conflict theory
• Dependency Theory
• World systems theory & Rostow’s Stages of
Growth
Nonconventional, Critical Theories of
Development
• Existing structure ‘fundamentally flawed’, ‘ethically challenged’,
morally wrong….
• Beyond growth - Well conceived development, redistribution
• Liberal critical theories – change some parts, socialist – how do rich
people get the money in 1st place?
• Leftist or Marxist – transform entire structure of society, ownership
structure of society
• Marxism: a philosophy of social existence, called historical
materialism; a theory of history, phrased as dialectics; and a politics
of socialism, collective social control over the development process.
Rethinking Inequality in
Development:
Cambridge or Chicago?
Pikety & Chancel, 2017.

Inequality
From British Raj to Billionnaire
Raj
Income inequality at its highest
level since 1922
Marx and the Conflict Theory of Development
• “The philosophers have only interpreted

the world, in various ways. The point,
however, is to change it.” – Marx
• A Brief Introduction to Marxism
• socioeconomic analysis that
views class relations and social
conflict using a materialist interpretation
of historical development
The Communist Manifesto
Ringing denunciation of capitalism,

“naked, shameless, direct, brutal
exploitation”
“This small pamphlet is by far the

most influential single piece of
political writing since the French
Revolutionary Declaration of the
Rights of Man and Citizen,” Eric
Hobsbawm…historian
“By good luck it hit the streets only a

week or two before the outbreak of
the revolutions of 1848”
Capital
Three volumes Capital 1867 Vol1 contradictions of Capitalist production
– Vols 2 & 3 1893 and 1894 posthumously by Engels focus on process of circulation of capital (319 pages) and Process of capitalist
production as a whole (645 pages)
Historical Materialism
• “Marx's thought integrates economics, history, philosophy, sociology
and politics.”
• Methodology that focuses on human societies and development
throughout history
• Beyond leaders to economic organization determining social institutions
(materialist conception of history)
• Mode of production – how a particular society organizes itself
Class struggle is basic disparity between evolving powers
of production and outdated institutions
All history is the history of class struggle
Division of Labour at each stage
• Tribal form – no social classes, kinship based, increase of wants leads to
slave culture, the beginning of class society.
• Primitive communism - concept of private property begins to develop,
concentration leads to transformation of the plebeian small peasantry into
a proletariat
• Feudal or estate property – community-based but enserfed small
peasantry, trade guilds, little division of labour
• Capitalism: Growth of commerce, feudal society accumulates capital,
• English and French Revolutions establishment of a society structured around
commodities and profit (capitalism).
• Transformation of labour bought and sold on market - exploitation of the proletariat,
• working class experiences alienation they feel not in control of the forces driving
them into a given job (someone else owns the means of production ).
Marxian Critique of Neo-classical economics
• “To lay bare the economic law of motion of modern society”
• Not just of economic variables within a given institutional framework
but also of the framework itself.
• Natural laws, relative laws within an institution
• Historical evolution of institutions – social, political and economic –
central to Marx’s thought.
• Materialist or economic determinist view of history
• Class struggle is basic disparity between evolving powers of
production and outdated institutions
Value and Capital
• Labour is the source of all value
• Value of a commodity is given by the labour embodied in it in absolute sense
• Use-Value (useful labour) and exchange-value (abstract labour)
• UV only in process of consumption
• Exchange value inseparable from the market
• Extraction of surplus value from labour is exploitation (vol1)
• Labour power is itself a commodity
• Capitalism is the first system in human history where a large volume of overproduction is
possible.
• Constant capital (machinery, raw materials, maintenance etc.) and variable capital (wages)
• Fluidity of capital and labour mobility conditions for capitalism
• Profit intrinsic to capital “ Aim of capital is not to minister to certain wants, but to produce profit”
Alienation
• “The worker exchanges with capital his labour itself…. He alienates it.
The price he receives is the value of alienation.”
• Alienating affect of the division of labour which serves to
• “mutilate the worker into a fragment of man, degrade him to the level
of an appendage of a machine, destroy the content of work by his
agony, and alienate him from the spiritual potentialities of the labour-
processes”
• Charlie Chaplin Modern Times
• Marxist reading of MT
Pauperisation
• “Concentration” process whereby capital
accumulates..
• Centralisation is merging of existing capital (aided by
credit systems)
• Two routes to capitalism
• Merchant class moves from trading to direct production.
(Italy)
• The real revolutionary way. Individual producers
accumulate capital, move from production to expand
sphere of activities to include trade. (FPOs of today?!).
Pauperism and pauperization are two of the most persistent and

widespread phenomena in India. (20% of population)
poverty and inequality in the informal economy
‘floating’ and ‘footloose’ transient labour. Aajeevika Bureau
‘Only Gandhi wrote about paupers’

Modernization, Dependency & World Systems
Theory
• Modernization theory
Economic development →Modern values →Democracy
progressive transition from a 'pre-modern' or 'traditional' to a 'modern' society.
Agents of diffusion (Aid, MNCs, colonialism etc.) desirable
• Dependency Theory
• Critique in the 1960s, largely in Latin America
• Resources flow from a "periphery" of poor and underdeveloped states to a
"core" of wealthy states.
World Systems Theory
• Poor states are impoverished and rich ones enriched by the way poor
states are integrated into the "world system". (Wallerstein, 1970s)
• ‘Spirit of Marxism not letter’ …Polanyi
• Futility of ‘statist orientation’….historical cycles of boom and bust
Philip O Hara
2015
The Geograhpy of WST
Low value-added products High value-added goods
(primaries: raw materials Center (industrial products)
and food)
Periphery
20
Development of Underdevelopment - Frank
The now developed countries were never underdeveloped though they may have
been undeveloped.
Dual societies and economies in underdeveloped countries.

“India” vs “Bharat”
“islands of California in a sea of sub-Saharan Africa”
Rostow’s Five Stages of Growth

Post-development Theory &
Gandhian Alternatives
DT Class 10, Jan 6-7, 2021
Dr C. Shambu Prasad
Happy 2021 and hope you all
make history
Contents
• Last class summary

• Post Development & Development Dictionary
• Gandhi and Post Development
• Assignment (20+10)
• Contested, discussion rather than closure
Post Development School
Wolfgang Sachs 1992 Escobar 1995 Rahnema Bawtree 1997

The Invention of Underdevelopment
• Encountering Development
• Truman’s speech changed the meaning of development (discourse).
On that day 2 billion people became underdeveloped…..
Transmogrified into an inverted mirror of others’ reality.
• Dvmt – escaping the condition of underdevelopment
• Nyrere – political mobilization of people for their own objectives
• Rodolfo Stavenhagen – ethnodevelopment or development with self-
confidence (‘look within’ ‘search for one’s own culture’)
• Anisur Rehman & Orlando Borda – participatory development
A metaphor and its contorted history
• Biological – genetic potential ..if did not grow fully (anamoly, pathology,
stunted)…evolution & dvmt interchangeable
• Central category of Marx’s work---natural laws
• Concept in vernacular – assumed violent form, history into a programme, a
necessary and inevitable destiny…!
• Western genealogy of history, robbing people of different cultures the
opportunity to define the forms of their social life.
• Truman – communists and proletariat to experts and to capital
• Amoeba like term … linked to growth, evolution, maturation
• For two thirds of the world – it is a reminder to them of “what they are
not”
Conceptual Inflation
• Development as equal or reduced to economic growth (Lewis 1944, Rostow, 1960)
• GNP dominated 1950s industrialization preferred model
• UNRISD in 1963, 1st decade of development – social and economic aspects separately
• Mcnamara of WB need to see beyond GNP
• 2nd decade –participative action, unified approach, major environmental problems
• 1974 declaration of Coyoc “Development not of things but man”
• Many roads to development Dag Hammarskold Foundation Another Development,
Human-centred development.
• UNESCO endogenous development
• 1980s “lost decade of development”
• Structural adjustment, Sustainable Development, HDR
Expanding the Reign of Scarcity
• Creation of the economic man – economization and colonization were
synonymous
• Disvaluing skills into lacks, commons into resources, tradition into
ignorance, autonomy into dependency etc.
• Scarcity the keystone of their theoretical construction.
• Polanyi’s Great Transformation (1949).. Economy as an autonomous sphere
carved out from rest of society.
New Commons
Struggle to limit the economic sphere
The Call
• An invitation to celebrate and call for political action.
• Celebrates the adventure of common men. Why dream borrowed dreams?
Post Development Reader
• Promising mirage… recurring nightmare for millions
• The Myth and Reality of Development
• View of Development from perspective of the ‘losers’
• Subversive (turn a situation and look from the other
side), Human-centred (whom does progress serve or
exclude), radical (what is fundamental)
• Contributors – gathering of friends, not as experts or
specialists
Post Development Theory: Gandhi
• Village Swaraj
• Truth, non-violence and Swaraj
• Western Development is violent…
voluntary simplicity
• Village Republics – an alternate
vision of democracy and
development… oceanic circles
• Economy of Permanance
Basic Principles of Village Swaraj
1. Supremacy of Man – Full 7. Self-sufficiency
Employment 8. Cooperation
2. Body-labour 9. Satyagraha
3. Equality 10. Equality of Religions
4. Trusteeship 11. Panchayati Raj
5. Decentralisation 12. Nai Talim
6. Swadeshi
Post Development: Gandhi as example and
Inspiration
• Vandana Shiva, Ashis Nandy, Rajni Kothari etc…
• Vikalp Sangam: Imagining the Future
• Vikalpsangam (assignment, 10%)
• http://vikalpsangam.org/article/case-studies-of-alternatives-older-
ones/#.X_UR7tgzaUk
• Collective Dreaming (EPW)
• Radical Ecological Democracy
What does self-
reliance really
mean? Amazing
stories emerge from
India’s villages
The Hindu, June 5,

2020
https://www.tribuneindia.com/news/archive/ela-ben-s-100-mile-communities--167067

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Lecture topic

What is Development? – Changing Paradigms

Hippu Salk Kristle Nathan

• Growth rate; rise in personal income

• Industrialization; technological advance

• Access to services; satisfaction of basic needs

Sen’s capability approach

• Child C: has been working on the flute for months, so deserve it

Who should get the flute?

towards Human development

towards Sustainable development

Considers only economic value (not social value, not environmental

Increases with polluting activities and again cleanups

Crime, divorce, and natural disasters as economic gain

Harvest of firewood or wild foods for own use.

Non-marketed goods provided by ecology – not accounted

Several features which cannot be monetized – beauty of a village.

No account of quality of products:

No account of quality of life:

Challenging fundamental notion of GDP

“Degrowth is a political, economic, and social movement based on anti-

“It raises the prospect of finally ejecting the twin demons of

Hippu Salk Kristle Nathan

• Shifts in approach to development – human dev.; sustainable dev.

• Limitations of monetary measures of development

• Degrowth: over consumption

Not a new finding

Ubuntu (African philosophy)

It relates natural wealth

“Africans have a thing called ubuntu. It is

We believe that a person is a person through other

Pluralistic understanding of well-being (Sen, 1987)

“Capabilities are the abilities to do certain things or to achieve desired

'to lead long and healthy lives, to be knowledgeable, to have access to

Definition as an enabling framework:

…“the capacity of economic, political and social systems to provide

Different (possibly competing) goals

Multiple definitions (anthropocentric endeavour)

Overuse of resources by people Limits to growth

Sustainable development ~ Policy

What is to be made sustainable?

Weak sustainability and strong sustainability

(adapted from SoEAC, 1996)

Changing the flute to scholarship on an infectious disease

Changing the flute to fruit/food

Changing the flute to party ticket in a safe constituency

Hippu Salk Kristle Nathan

• Shift from the conventional notion (that had a wrong objective)

• GDP/GNP - was wrongly identified as end

• Traditional way of looking at development

- Human welfare – only beneficiaries

• Human beings are both ends and means

• Freedoms are both primary aims and principal means to development

Focus on freedoms – as that’s what development advances

Concentrate on that end or objective – rather than some of the means

Development – removal / reduction of unfreedoms

Inability to satisfy hunger

Inability to be adequately clothed

Freedom has both constitutive and instrumental role

Intrinsic value – for example: health and education

Market’s fundamental feature - freedom of exchange and transaction

Bonded labour – rejection of freedom to participate in labor market

“Development as freedom” approach – broader and more inclusive