Trickle-down” effect has been a long standing talking point in economic history. Economists like Jagdish Bhagwati and Amartya Sen have had enormous arguments on the same topic through the literary medium. These and more of such debates instigated this paper, which attempts to investigate the effect of economic growth on the overall economy; most importantly the lower section of the income group. For achieving this objective, the paper delves into the evidences of the “Growth-Equity Trade-off” in two of the biggest Asian economies, China and India. Secondary data analysis on various macro indicators have been done to achieve the same. Both China’s 1979 and India’s 1991 reforms share common features in the sense – along with an increase in growth rates there has been an increase in inequality. With a lot of growth enhancing policies currently envisaged in India like the “Make in India” this paper seeks to identify the possible reasons for unequal growth in the past. After dwelling deep into the dynamics of economic transition during the reform period the paper goes onto recommend necessary policy interventions like skill development, strong competition policy, and a need for incentive to domestic small scale players which must be in place to ensure the benefits of the growth reach all sections of the society.
Chinese growth story, Indian reforms, inclusive development, lessons from history, make in India, trickle-down effect.
Athreya Mukunthan is with the Public Affairs Centre, Bangalore, India (e-mail: email@example.com).
Athreya Mukunthan and Omkar Raut, "
“Make in India” Push-Crucial Lessons from History," Journal of Economics, Business and Management vol. 4, no. 7, pp.