Public Finance And Economic Development In India
The study made by the learned authors (a husband-wife team), in the present volume, covers all the important aspects of the economics of Indian Public Finance in terms of their bearing on the long term growth of the economy. The work is essentially an attempt to analyse the fiscal experience of the Indian economy in its endeavour to promote its growth in the context of a framework of mixed economy. It is a fiscal exercise in development experience. In the highly developed economics the role of public finance is to keep the economy on the path of progressive equilibrium by attempting to make the natural rate of growth equal to the warranted rate of growth. But in a developing economy its role become multi-dimensional. It has to operate as a positive instrument of economic development by raising the levels of saving and investment in order to achieve a compound rate of growth. Such an economy is highly susceptible to informationary pressures because of the demand for resources tending to exceed their supply in a context of shortage of real resources and public finance, therefore, has to operate to achieve monetary stability as well in order to prevent the information forces from affecting adversely the process of economic development. Further the relationship between deficit financing and money supply has been analysed and the growth in reserve money and its effect on he multiple creation of credit through the mechanism of the credit multiplier has been examined. It also analyses the relationship between money supply and the behaviour of the general price level by taking into account the rate of growth of national output. From all accounts it is a unique work which embodies the results of the in-depth study conducted by the authors of the multi-dimension role of Indian economy in its endeavours to promote economic development. It will prove highly useful not only to students conducting post graduate courses in Political Economy but also to economic planners, business and financial executives, research scholars, policy makers and plethora of commissions and committees appointed for assessing the role of public and private sector economy.
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