Explain the 'welfare maximization' and 'economic growth' in the context of Indian economy.
Welfare economics focuses on the optimal
allocation of resources and goods and how the allocation of these resources
affects social welfare. This relates directly to the study of income
distribution and how it affects the common good. Welfare economics is a
subjective study that may assign units of welfare or utility to create models
that measure the improvements to individuals based on their personal scales.
The economic development in India followed socialist -inspired policies
for most of its independent history, including state-ownership of many sectors; India’s per capita income increased at only
around 1% annualised rate in
the three decades after its independence. Since
the mid-1980s, India has slowly opened up its markets through economic
liberalisation. After more fundamental reforms since 1991 and their renewal in
the 2000s, India has progressed towards a free
market economy. In the late
2000s, India's growth reached 7.5%, which will double the average income in a
decade. Analysts say that if India pushed more
fundamental market reforms, it could sustain the rate and even reach the
government's 2011 target of 10%.
Welfare economics focuses on the optimal
allocation of resources and goods and how the allocation of these resources
affects social welfare. This relates directly to the study of income
distribution and how it affects the common good. Welfare economics is a
subjective study that may assign units of welfare or utility to create models
that measure the improvements to individuals based on their personal scales.
The economic development in India followed socialist -inspired policies
for most of its independent history, including state-ownership of many sectors; India’s per capita income increased at only
around 1% annualised rate in
the three decades after its independence. Since
the mid-1980s, India has slowly opened up its markets through economic
liberalisation. After more fundamental reforms since 1991 and their renewal in
the 2000s, India has progressed towards a free
market economy. In the late
2000s, India's growth reached 7.5%, which will double the average income in a
decade. Analysts say that if India pushed more
fundamental market reforms, it could sustain the rate and even reach the
government's 2011 target of 10%.
