The Civil Services exam comprises questions related to various subjects like Geography, Polity, Science and technology etc. Economics is also an important subject for UPSC CSE. Economics is further divided into Macroeconomics, Microeconomics, Indian economy etc. Macroeconomics and Indian economy based questions are mostly asked in the UPSC CSE exam. Let’s examine what Macro and Microeconomics contain, and which should you focus on while preparing for IAS exams.
| Looking for study material to prepare for the upcoming Civil Services Exam?
Refer to the links below and complement your UPSC exam preparation: |
Macroeconomics or Microeconomics for UPSC Civil Services Exam?
In order to understand the relevance of micro and macroeconomics for UPSC CSE, let’s take a look at the UPSC Prelims and Main exam syllabus for Economics.UPSC Preliminary Exam Syllabus for Economics
- Economic and Social Development-Sustainable Development,
- Poverty,
- Inclusion,
- Demographics,
- Social Sector Initiatives, etc.
UPSC Main Exam Syllabus for Economics
Economics is part of General Studies-III in the Main examination. The economics topics include:
- Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment
- Inclusive growth and issues arising from it
- Government Budgeting
- Major crops-cropping patterns in various parts of the country – different types of irrigation and irrigation systems storage, transport and marketing of agricultural produce and issues and related constraints; e-technology in the aid of farmers
- Issues related to direct and indirect farm subsidies and minimum support prices; Public Distribution System – objectives, functioning, limitations, revamping; issues of buffer stocks and food security; Technology missions; economics of animal-rearing
- Food processing and related industries in India – scope and significance, location, upstream and downstream requirements, supply chain management
- Land reforms in India
- Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth
- Infrastructure: Energy, Ports, Roads, Airports, Railways etc
- Investment models
If you go through the UPSC syllabus given above and the previous years’ questions you will understand that most of the areas are related to macroeconomics, Indian economy, public finance, banking etc. If you see the trend, UPSC generally focuses on current and static information, mainly related to India. Important events that affect the world economy and business are also asked for the exam. Therefore, in order to prepare for economics, aspirants should study:
- India Economic Development (Class 11 NCERT)
- Macroeconomics (Class 12 NCERT)
- Microeconomics (Class 12 NCERT)- Go through important concepts
- Indian Economy by Ramesh Singh or The Indian Economy by Sanjiv Verma
- Economic Survey
- Union Budget
- Newspapers
It is important to at least cover these resources for Economics.
Points to Remember: How to prepare for UPSC CSE Economics Topics
- Macroeconomics NCERT textbook may not be updated, and therefore you need to refer to other Indian economy textbooks, Economic Survey and newspapers for current data.
- You should make a note of important government schemes.
- While reading the newspaper, look for important information related to business and economics like repo rate, cryptocurrency, Brent Crude Oil etc. and write it down.
- You should definitely go through important and relevant chapters of the Economic Survey.
- Read the Union Budget
Important Components of Macro and Microeconomics
The important topics that are part of Micro and Macroeconomics NCERT textbooks are given below.
Topics that are part of Microeconomics and Macroeconomics
| S.No. | Macroeconomics Topics | Microeconomics Topics |
| 1 | National Income Accounting: The Product or Value Added Method, Expenditure Method, Income Method, GDP and prices | Central problems of an economy |
| 2 | Money and Banking: Demand and supply of money, RBI, Monetary policy | The Consumer’s Budget |
| 3 | Income determination: the multiplier mechanism | Preferences of the Consumer: Diminishing Rate of Substitution, Indifference Curve, utility |
| 4 | Government budget: Revenue account, capital account, deficit | Demand: Normal and inferior goods, substitutes and complements, shifts in the demand curve |
| 5 | Fiscal policy: taxation, public debt, government expenditure | Elasticity of demand |
| 6 | Balance of Payments: BoP surplus and deficit | Production and cost |
| 7 | The Foreign Exchange Market: Determination of the Exchange Rate, Flexible Exchange Rates, Fixed Exchange Rates, Managed Floating, Exchange Rate Management | Perfect competition |
| 8 | The Determination of Income in an Open Economy | Equilibrium |
| 9 | Trade Deficits, Savings and Investment | Non-competitive markets: Monopolistic competition, Oligopoly |
Related Links
Comments