Impact of rural industrialization on village life and economy: A social accounting matrix approach

Economic Development and Cultural Change

Volumn 44, Issue 2, 1996, Pages 351-377

  Parikh, Alka ^a   Thorbecke, Erik ^a  

^a Department of Population Medicine and Diagnostic Sciences

Author keywords

[No Author keywords available]

Indexed keywords

DECENTRALISATION; DEVELOPING COUNTRY; INDUSTRIAL DECENTRALISATION; POVERTY ALLEVIATION; RURAL DEVELOPMENT; SOCIAL ACCOUNTING MATRIX; SOCIOECONOMIC IMPACT;

INDIA;

EID: 0029772190     PISSN: 00130079     EISSN: None     Source Type: Journal    
DOI: 10.1086/452218     Document Type: Article

References (25)

1. R. P. Misra, K. V. Sundaram, and V. L. S. P. Rao, Regional Development Planning in India: A New Strategy (Delhi: V. Rao, 1974).
2. See Sudhir Wanmali, Geography of Rural Service System in India (Delhi: B. R. Publishing, 1987); and R. L. Sanghavi, Role of Industrial Estates in a Developing Economy (Bombay: Multi-Tech, 1979).
3. See Sudhir Wanmali, Geography of Rural Service System in India (Delhi: B. R. Publishing, 1987); and R. L. Sanghavi, Role of Industrial Estates in a Developing Economy (Bombay: Multi-Tech, 1979).
4. S. Subramanian and E. Sadoulet, "The Transmission of Production Fluctuations and Technical Change in a Village Economy: A Social Accounting Matrix Approach," Economic Development and Cultural Change 39, no. 1 (1990): 131-73; and B. Lewis and E. Thorbecke, "District-Level Economic Linkages in Kenya: Evidence Based on a Small Regional SAM," World Development 20, no. 6 (1992): 881-97.
5. S. Subramanian and E. Sadoulet, "The Transmission of Production Fluctuations and Technical Change in a Village Economy: A Social Accounting Matrix Approach," Economic Development and Cultural Change 39, no. 1 (1990): 131-73; and B. Lewis and E. Thorbecke, "District-Level Economic Linkages in Kenya: Evidence Based on a Small Regional SAM," World Development 20, no. 6 (1992): 881-97.
6. Throughout the article, the population of the two villages is divided into four groups according to the ownership of land. The definition of such groups comes from the ICRISAT landownership scale, which is given in the Appendix (table A1).
7. Total incomes are the sum of the total incomes earned by each income class in the village. The incomes are calculated from the SAMs, which are presented in tables 2 and 3. The concept of total village income is similar to the concept of national income in the national accounts.
8. i is the income shortfall of the ith household.
9. One anomaly that needs to be clarified is that the average income of the landless in Aurepalle, as reported in table 1, appears higher than the average income of the small farmers. The reason is that the category of landless households is, in fact, highly bimodal. It includes the vaisyas, who are a prosperous business community but do not hold land by tradition. Therefore, the average income of the Aurepalle "landless" reported in table 1 and in the two SAMS (tables 2 and 3) is much higher than that of the typical poor landless. Hence to compare the incomes of the rich and the poor, we use the average income of the small farmers' class, which is very poor in Aurepalle and so can be treated as representative of the poor including the "true" landless in the village.
10. The GDP for the village is calculated in the same way the GDP is calculated for a country. It is the sum of value added of the production activities in the SAMs.
11. I. Adelman, E. Taylor, and S. Vogel, "Life in a Mexican Village: A SAM Perspective," Journal of Development Studies 1 (1988): 5-24.
12. n. As long as the sums of the column totals of endogenous marginal expenditure propensities and exogenous expenditure propensities add up to unity, consistency is maintained.
13. National Sample Survey, in Sarvekshana (April-June 1989), pp. S15-S60.
14. See G. Pyatt and J. Round, "Accounting and Fixed Price Multipliers in a Social Accounting Matrix Framework," Economic Journal 89 (December 1979): 850-73.
15. Subramanian and Sadoulet (n. 3 above); Lewis and Thorbecke (n. 3 above).
16. Ibid.
17. See Lewis and Thorbecke.
18. Ibid.
19. The total output multiplier for any account can be obtained by summing up the first eight rows of the multiplier matrix for the concerned account's column in tables 5 and 6, respectively. Likewise the total income multipliers are obtained by summing up the four landholding classes' respective multipliers. Total output and income multipliers are shown explicitly in tables 5 and 6, respectively.
20. Hired labor consists of agricultural and casual laborers.
21. Jacques Defourny and Erik Thorbecke, "Structural Path Analysis and Multiplier Decomposition within a Social Accounting Matrix Framework," Economic Journal 94 (March 1984): 111-36.
22. The highest income multipliers obtain for the factors but they are not considered because factor income multipliers are definitionally higher than production activities' multipliers. The factor income multipliers are considered only when the production activity generating the income is located outside the village, which is not the case with Aurepalle.
23. See J. L. Pender and M. Asoka, Farmers' Irrigation Investment in South India (International Crop Research Institute for the Semi-Arid Tropics, 1993).
24. Harold Alderman, "Cooperative Dairy Development in Karnataka, India: An Assessment," Research Report 64 (International Food Policy Research Institute, Hyderabad, India, December 1987).
25. T. Walker and G. Ryan, Village and Household Economies in India's Semi-Arid Tropics (Baltimore: Johns Hopkins University Press, 1990).