Internal Migration, Center-State Grants and Economic Growth in the States of India

July 1, 1995

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Paul Cashin, and Ratna Sahay. Internal Migration, Center-State Grants and Economic Growth in the States of India, (USA: International Monetary Fund, 1995) accessed December 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper examines the growth experience of twenty states of India during the period 1961-91, using cross-sectional estimation and the analytical framework of the Solow-Swan neoclassical growth model. We find evidence of absolute convergence--initially-poor states did indeed grow faster than their initially-rich counterparts. There has also been a widening of the dispersion of real per capita state incomes over the period 1961-91. However, relatively more grants were transferred from the central government to the poor states than to their rich counterparts. Significant barriers to population flows also exist, as net migration from poor to rich states responded only weakly to cross-state income differentials.

Subject: Disposable income, Expenditure, Migration, National accounts, Personal income, Population and demographics, Public expenditure review

Keywords: Center-State grant, Closed economy, Constant term, Cross-state migration calculation, Disposable income, Elasticity of migration, Europe, European OECD country, Government of India, Income elasticity, Least squares, Migration, Per capita income, Personal income, Public expenditure review, Rural-to-rural migration, State income, Vital statistics, WP

Publication Details

Pages:

56
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1995/066
Stock No:

WPIEA0661995
ISBN:

9781451848762
ISSN:

1018-5941

Notes

Examines the growth experience of twenty states of India during the period 1961-91, using cross-sectional estimation and the analytical framework of the Solow-Swan neoclassical growth model. Also published in Staff Papers, Vol. 43, No. 1, March 1996.

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