Regional sources of growth acceleration in India
Abstract
Gujarat, West Bengal, Karnataka, Maharashtra, Kerala
and Tamil Nadu were the major contributors to the
growth acceleration in India after 1991-92. Although
regional disparity may increase temporarily, the causality
test provides support to the hypothesis about spread
effects. The regional growth targets assigned by the
Eleventh Plan in India seem to rely on the spread effects
of economic growth acceleration in the better-off states
to achieve its 9% growth target and reduce regional
disparity in the long run. To strengthen the spread
effects, the domestic economy should be further
integrated and interlinked with free flow of goods,
services and factors of production.
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