Development of Societies

HSMC 101-18

Unit 3: Economic Development

1
Development of Societies

Social Development

Political Development

Economic Development
Economic Development
 Economic Development
• Economic development is defined as an
increase in a country's wealth and standard of
living.

• An example of economic development is

when a country begins to produce more
products and increase its overall wealth.
 What is Economy?
• Economics is the study of the production and
consumption of goods and the transfer of wealth
to produce and obtain those goods.

• Economics explains how people interact within

markets to get what they want or accomplish
certain goals.

• Since economics is a driving force of human

interaction, studying it often reveals why people
and governments behave in particular ways.
 What is Economic Development?
• Economic development generally refers to the
sustained, concerted actions of policymakers and
communities that promote the standard of living
and economic health of a specific area.

• Such actions can involve multiple areas including

development of human capital, critical
infrastructure, regional competitiveness,
environmental sustainability, social inclusion,
health, safety, literacy, and other initiatives.
• Due to being mixed Economy,
Economic development of
India depends on following
factors:-

1.Agriculture
2. Industrial Output
3. Services
4. GDP growth rate
5. Health
6. Safety
 Growth versus Development
• Economic growth may be one aspect of economic
development but is not the same

• Economic growth: – A measure of the value of

output of goods and services within a time
period. Phenomenon of market productivity and
rise in GDP.

• Economic Development: – A measure of the

welfare of humans in a society. Aims of economic
and social well-being of people
 Economic Growth
• Increase in goods & Services produced by an
economy or nation, considered for a specific
period of time.

• The rise in the country’s output of goods and

services is steady and constant and may be
caused by an improvement in the quality of
education, improvements in technology or in any
way if there is a value addition in goods and
services which is produced by every sector of the
economy.
• Economic growth refer to quantitative changes.

• It is a process of growth in the national & per

capita income.

• Production of Larger amount of Goods &

Services signifies growth.
 Difference Between Economic Growth
and Economic Development
Economic Growth Economic Development
Single Dimensional – Goods Multi Dimensional – health,
production and sale. safety and well fare.
Quantitative Qualitative

Continuous and steady change Spontaneous and discontinuous

change
Used for Developed Economics Used for developing Economics

Example- GDP (Gross Domestic Example - Industrial

Product) Development, HDI
 Economic Growth Economic Development
Definition
It refers to the increase in the monetary growth of a It refers to the overall development of the quality of
nation in a particular period. life in a nation, which includes economic growth.

Span of Concept
It is a narrower concept than that of economic It is a broader concept than that of economic growth.
development.
Scope
It is a uni-dimensional approach that deals with the It is a multi-dimensional approach that looks into the
economic growth of a nation. income and as well as the quality of life of a nation.

Term
Short-term process Long-term process
Measurement
Quantitative Both quantitative and qualitative
Applicable to
Developed economies Developing economies
Government Support
It is an automatic process that may or may not require It requires intervention from the government as all
intervention from the government the developmental policies are formed by the
government
Kind of changes expected
Quantitative changes Quantitative as well as qualitative changes
 SUSTAINABLE DEVELOPMENT
• There is a new concept of Economic
Development known as Sustainable
Development.

• Sustainable Development is that process of

economic development which aims at
maintaining the quality of life of both present
and future generations without harming
natural resources and environment.
 CONDITIONS OF SUSTAINABLE
DEVELOPMENT

1. Economic development
2. Conservation of Natural Capital Stock.
3. Reduction in Industrial Pollution.
4. Reduction in Agricultural pollution.
5. Comprehensive Rural Development.
 SIGNIFICANCE OF SUSTAINABLE
DEVELOPMENT
• Raising the standard of living of the existing
Population.

• Checking any harm to the living standard of the

future generation.

• Protecting the people against Pollution of their

quality of their life and health.

• Conserving environment which is so much

necessary for sustainable development.
Determinants of Economic
Development
 Economic Determinants
1. Quantity and Quality of Natural Resources.

2. Quantity and Quality of Human Resources –

physical labors, entrepreneur, organization.

3. Physical Capital Resources- investment, real

savings

4. Technical Progress

5. International Determinants
 Non-Economic Determinants
• Social Determinants
• Political Determinants
• Religious Determinants
• Freedom from Corruption
• Law and Order Situation
• Aspiration of Development
 Human Development Index (HDI)
• It is a summary of human development
around the world and implies whether a
country is developed, still developing, or
underdeveloped based on factors such as life
expectancy, education, literacy, gross domestic
product per capita.

• Used to measure Economic Development.

 Gross Domestic Product (GDP)
• GDP can be calculated by adding up all of the
money spent by consumers, businesses, and
government in a given period. It may also
be calculated by adding up all of the money
received by all the participants in the economy.

• Used to measure Economic Growth.

 • Thank You

• Any Queries?????
Development of Societies
HSMC 101-18

Unit 3: Economic Development

Birth of Capitalism, Socialism, Marxism

24
 Capitalism
 Capitalism is the most prominent in our current global
economic system. Its main characteristic is that it most
means of production and property are privately
owned by individuals and companies. The
government has a limited role in such an economy
limited to management and control measures.

 So a capitalist economy is a liberal economy. This

means only the free market will determine the supply,
demand, and prices of the products. There is no direct
government intervention other than to control
monopolistic practices in the economy.
• The economic system in which businesses are owned and
run for profit by individuals and not by the state.

• Capitalism ensures efficiency because it is self-regulated

through competition.

• It promotes innovation, freedom, and opportunity.

• Capitalism meets the needs of the people and is beneficial

to societies as a whole.

• Minimal government intervention and protection of private

property rights.

• USA, UK, Germany, Japan, Singapore all are classic

examples of capitalist economies.
 Birth of Capitalism
 In the medieval era, money could represent and convert only things that
existed in the present. This imposed a severe limitation on growth, since
it made it very hard to finance new enterprises.

 Smith’s claim that the selfish human urge to increase private profits is
the basis for collective wealth is one of the most revolutionary ideas in
human history – revolutionary not just from an economic perspective,
but even more so from a moral and political perspective.

 Capitalism began as a theory about how the economy functions. It was

both descriptive and prescriptive – it offered an account of how money
worked and promoted the idea that reinvesting profits in production
leads to fast economic growth

 Its principal tenet is that economic growth is the supreme good, or at

least a proxy for the supreme good, because justice, freedom and even
happiness all depend on economic growth.
 Features of a Capitalist Economy

1. Right to Private Property

2. Price Mechanism
3. Profit Motive
4. Freedom of Enterprise
•Right to Private Property: This is the essence
of capitalism. This right means that private property
such as property, factories, machines, plants etc. can
be owned under private individuals and companies.

The three things covered under this right are:

1. Every individual can acquire any amount of
property.
2. He can use these properties as he wishes.
3. He also has the right of inheritance. So he can
inherit the property from his forefathers. And he
can also pass it on to his successors on his death.
• Price Mechanism:

Price mechanism is like an invisible hand that

controls the workings of a capitalist economy.
The forces of supply and demand will
determine the prices and the level of
productions in the economy. The government
will not have any interference in this matter.
•Profit Motive: The driving force behind any
capitalist economy is the profit motive. All
companies wish to produce and sell their
products to maximize their profits. This also
induces healthy competition in the economy.

•Freedom of Enterprise: In capitalism, every

individual is free to make his own economic
choices without any intervention. This includes
both the consumer and the producers.
 Benefits
1. Economic Freedom - one can spend one’s income
according to one’s wishes.
2. Automatic Working - demand and supply
3. Variety of Goods and Services - attention to
consumer’s taste
4. Optimum Use of Resources - earning profit and no
scope for wastages at all
5. Efficient Producer - encouraged to produce best
quality of products due to competition
6. Higher Standard of Living - Varieties of goods at cheap
rates for poor and weaker people
7. Incentive to efficient - reward according to his ability
8. New Inventions - To get more profit
 Demerits
1. Labour Exploitation
2. Class Struggle
3. Wasteful Competition
4. Threat of Over-Production
5. Economic Fluctuations
6. Unbalanced Growth
7. No Welfare Activities
8. Monopoly Practices
 Socialism
• The political idea that is based on the belief
that all people are equal and that money and
property should be equally divided

• Economic system is controlled and regulated

by the government
 Socialism
 Socialism, social and economic doctrine that calls for
public rather than private ownership or control of
property and natural resources. According to the socialist
view, individuals do not live or work in isolation but live in
cooperation with one another. Furthermore, everything
that people produce is in some sense a social product, and
everyone who contributes to the production of a good is
entitled to a share in it. Society as a whole, therefore,
should own or at least control property for the benefit of
all its members.

 Socialism refers to the government ownership of the

means of production, planning by the government and
income distribution
 Features of Socialist Economy
1. Collective Ownership - production are owned by the
state, Government
2. Economic, Social and Political Equality - equality
between rich and poor
3. Economic Planning - government fixes certain
objectives
4. No Competition - state is the sole entrepreneur
5. Positive Role of Government - decision making
6. Work and Wages According to Ability and Needs
7. Maximum Social Welfare - no scope of exploitation of
labour class
 Birth of Socialism
• It began as a response to the dire poverty and
inhumane working conditions in industrialized Europe
in the early 19th century

• Socialism really took off in mid-century, spurred by the

writings of German philosopher Karl Marx and the rise
of labour unions

• Socialism emerged as a response to the expanding

capitalist system. It presented an alternative, aimed at
improving the lot of the working class and creating a
more egalitarian society
 Merits of Socialism
(1) Greater Economic Efficiency

(2) Greater Welfare due to Less Inequality of

Income

(3) Absence of Monopolistic Practices - all means

of production are owned by the state

(4) Absence of Business Fluctuations - neither

overproduction nor unemployment
 Demerits of Socialism
1. Loss of Consumers’ Sovereignty - Consumers do not
have the freedom to buy whatever commodities they
want.

2. No Freedom of Occupation - Every person is provided

job by the state; cannot change job.

3. Allocation of Resources - work is done on trial and error

basis.

4. Bureaucratic - People work due to the fear of higher

authorities and not for any personal gain or self-interest.
 Marxism
• It is a social, political, and
economic philosophy named
after Karl Marx.

• It examines the effect of

capitalism on labor,
productivity, and economic
development and argues for a
worker revolution to overturn
capitalism in favor of
communism. (system in which goods are
owned in common and are available to all as needed)
• Marxism in simple terms, it's a political and
economic theory where a society has no
classes.

• Every person within the society works for a

common good, and class struggle is
theoretically gone.
 Birth of Marxism
Marxism originated in the thought of the German
radical philosopher and economist Karl Marx, with
important contributions from his friend and
collaborator Friedrich Engels. Marx and Engels
authored The Communist Manifesto (1848), a
pamphlet outlining their theory of historical
materialism and predicting the ultimate overthrow
of capitalism by the industrial proletariat. Engels
edited the second and third volumes of Marx’s
analysis and critique of capitalism, Das Kapital, both
published after Marx’s death.
 Components of Marxism
 Dialectical Theory-A Triple method,
 mode of production change into relation of production
 relation of production give birth to productive forces
 Certain stage both clashes and give birth to new product

 Economic idea –Means of Production, Means of Labour,

Subjects of Labour, Mode of Production, Surplus Value
etc.

 State & Revolution-

 two type of socieities , class and classless.
 When relations of production and Productive forces
clashes and give birth to new mode of production
 Benefits of Marxism
true equality – class basis
 benefits to the society
helps with socialism
reduces the tendency of debt
protects the rights of unions
 Weakness
abolish religion.
limits opportunities for entrepreneurs
lead to communism
How Socialism differ from Marxism
• Under socialism, the means of production are owned
or controlled by the state for the benefit of all, an
arrangement that is compatible with democracy and a
peaceful transition from capitalism.

• Marxism justifies and predicts the emergence of a

stateless and classless society without private property.
That vaguely socialist society, however, would be
preceded by the violent seizure of the state and the
means of production by the proletariat, who would
rule in an interim dictatorship.
 • Thank You

• Any Queries?????
Development of Societies
HSMC 101-18

Unit 3: Economic Development

Concept of Development in Pre-British

(Barter and Jajmani), British Period and
Post-British
48
 Economic Development

Pre-British British Post - British

Pre – British era or Time Zone

1. Nawabs/ Kings – No concept of money

2. Evolvement of Money/currency
 A. Nawabs/Kings
• No concept of money/trade/currency

1. Barter System
Concept
2. Jajmani System
 Barter System
• Exchange of services or goods for other
services and goods in return.

• Give and take

• Goods against services offered

Advantages of Barter System:-

1. No problem of concentration of wealth in few hands.

2. Simple system – give and take

3. No question of over/ under production – labour free

4. No external factor (Eg. International trade, foreign

exchange, crises, etc.)
Disadvantages of Barter System:-

1. Double coincidence of wants – i.e., both to satisfy

2. No measure of value

3. Problem of storing

4. Problem of transportation

5. Lack of Divisibility
 Jajmani System
• Closed Barter System.

• Between landlords - higher castes

JAJMAN

Landlesss service class - lower castes

KAMIN or Praja
 Jajmani System Feature
• Hereditary - generation after generation

• Kamins received grains from Jajman’s for services

offered. (eg – barber, cobbler)

• Durable or Permanent Relation

• Goods Against Services

• Peace and Satisfaction

• Difference in Scope of Work

Advantages of Jajmani System:-
• 1. Security of Occupation:
Security of occupation is guaranteed in case of
jajmani system. Since this system is hereditary,
the kamin is assured of his occupation. He knows
that if he breaks his family occupation he shall
not be able to earn his livelihood.

• 2. Economic Security:
It provides economic security to kamins as the
jajman looks after all of their needs. The kamins
are assured of their economic security. In every
monetary crisis the jajman helps the kamins.
They extend all possible help to the kamins. So
there is economic security in the jajmani system.
• 3. Close and Intimate Relationship:
There is close and intimate relationship between the
jajman and kamin. This relationship is not purely
economical but it is sentimental and internal. A spirit of
fellow feeling and brotherhood develops under this
system. Both jajman and kamin know full well each
other’s limitations as well as plus points.

• 4. Peaceful Living:
The cut-throat-competition for work or employment is
almost absent in jajmani system. No jajman goes without
service nor any kamin goes without food. So this system
creates an atmosphere of peaceful living by creating the
spirit of fellow-feeling and co-operation.
Disadvantages of Jajmani System:-
B. Evolvement of Money/Currency
• Emergence of
Agriculture and Cottage Industry

Farming Local level people use

their surroundings to
make things

Eg - Handicraft, Selling
Honey
• India basically resided in villages.
• 85% dependent & indulged in Agriculture.

• Cottage industry –
1. Locally manufacturing products
2. at own level
3. Example – Khadi, Silk, craft. Etc.
• Universally claimed i.e., famous worldwide and
in demand

• Therefore, India called as “Golden Bird”.

• But it has its own disadvantages:-

1. Unorganized
2. Delayed payments
3. Transportation
4. Excess demand – labour

Taking advantage of this Britishers came into

India to set up – EAST INDIA COMPANY.
British era or Time Zone
1. Machine Revolution –
Destroyed our cottage industries.

2. Cash Crop Policies –

Havoc on Indian environment
leading to famines (scarcity of food) killing
millions.
Eg – forced to grow cotton and silk
3. Wealth concentration to own land and not
invested back –
Took money from India back to
their own country.

4. Exporter Importer
(became poorer and poorer)
5. Unnecessary Expenditure –
Burden over India. Eg - Army

6. Divide and Rule Policy –

breaking up larger concentrations
of power into pieces that individually have less
power

Therefore, Disastrous for Indian Economic Development

moved the life of all sections particularly labour.
Post - British era or Time Zone

i.e., Independent India

 Post – British

1. 1950’s - Rapid Industrialization

2. 1960’s - Agriculture Strategy
3. 1970’s and 1980’s - Agriculture industry
4. 1990’s - Disinvestment
5. 2000’s - All Multinationals available
1. Initial Strategy – 1950’s

• State Owned Enterprise (SOE)

• Rapid Industrialization – in the field of Steel,
Chemicals, machines/tools, power, etc.

– Government founded and set up industries in above fields

or invested back in development

– Priority given to industry and not agriculture.

– Track protection/License Raj to protect Government

industries as well as all private industries to obtain license
for – new, change, growth; but under the control of
Government.
• Initial success but later on in 1960’s and 1970’s
problems on account of political control/inter
finance.

Result:- 1. Drained Government Resources.

2. No use in generating labour
3. All other sections ignored, depended
upon other countries

– Food Crises of 1960’s, leading to import from

USA, etc.
 2. 1960’ s
- Back to Agriculture Strategy.

Twin formula – 1. Guarantee higher value for crops

2. Subsidy on tools, fertilizers

- Brought in “Green Revolution” – Self Sufficient

3. 1970’s and 1980’s

• While Agriculture gained Industry Drained.

Reasons: - 1. Rigid Licensing

2. Government Control – no free hand
3. Unreasonable policies

• Our products not of international standard as

foreigners ignored and we had to use.

• Nail on the coffin - - Era of emergency

- - Unstable Government
 4. 1990’s
• Economy on the verge of collapse

• Disinvestment policy by Dr. Manmohan Singh

1. State owned enterprise (SOE) for Sale.

2. Allowed Foreign investors (reduced taxes, import duties)
3. Reduced Licensing Policy and Prices control.

Lead to Liberalization, privatization

and globalization.
 5. 2000’s
• Continued to bear the fruits of 90’s

• All Multinationals, readily available.

• No difference between Global and Indian Brands.
 Post – British

1. 1950’s - Rapid Industrialization

2. 1960’s - Agriculture Strategy
3. 1970’s and 1980’s - Agriculture industry
4. 1990’s - Disinvestment
5. 2000’s - All Multinationals available
 • Thank You

• Any Queries?????
Development of Societies
HSMC 101-18

Unit 3: Economic Development

Idea of Development is Current Context

78
 Development
Improvement

Country’s Social
economic Conditions

Improves
Creates Wealth
People’s Lives
 Development
• Development means “improvement in
country’s economic and social conditions”.

• It refers to improvements in way of managing

an area’s natural and human resources. In
order to create wealth and improve people’s
lives.
• Development is not purely an economic
phenomenon but rather a multi-dimensional
process involving reorganization and
reorientation of entire economic AND social
system

• Development is process of improving the

quality of all human lives with three equally
important aspects. These are:
 Three Objectives of Development
1. Raising people’s living levels, i.e. incomes and
consumption, levels of food, medical services,
education through relevant growth processes

2. Creating conditions conducive to the growth of

peoples’ self-esteem through the establishment
of social, political and economic systems and
institutions which promote human dignity and
respect

3. Increasing people’s freedom to choose by

enlarging the range of their choice variables, e.g.
varieties of goods and services
 Several conditions using which
Development can be done:
i. The capacity to obtain physical necessities,
particularly food;

ii. A job (not necessarily paid employment) but

including studying, working on a family farm
or keeping house;

iii. Equality, which should be considered an

objective in its own right;
iv. Participation in government;

v. Belonging to a nation that is truly independent,

both economically and politically; and

vi. Adequate educational levels (especially literacy).

 Human scale development
• The people are held to be the principal actors
in human scale development.

• Respecting the diversity of the people as well

as the autonomy of the spaces in which they
must act converts the present day object
person to a subject person in the human scale
development.
• Human scale development calls for a direct and
participatory democracy where the state gives up
its traditional paternalistic and welfarist role in
favour of a facilitator in enacting and
consolidating people’s solutions flowing from
below.

• “Empowerment” of people takes development

much ahead of simply combating or ameliorating
poverty. In this sense development seeks to
restore or enhance basic human capabilities and
freedoms and enables people to be the agents of
their own development.
• A focus on people and the masses implies that
there could be many different roads to
development and self-reliance.

• The slogans “human centred development”, “the

development of people”, “integrated
development”, all call for a more inclusive and
sensitive approach to fundamental social,
economic and political changes involved in
development such that all aspects of life of a
people, their collectivity, their own history and
consciousness, and their relations with others
make for a balanced advancement.
 Challenge
• The challenge of human scale development is
to nurture diversity instead of being
threatened by it, to develop processes of
political and economic decentralisation, to
strengthen democratic, indigenous traditions
and institutions and to encourage rather than
repress emerging social movements which
reflect the people’s need for autonomy and
space.
• The issues of environment, pollution, women,
habitat, hunger and employment have come
to the fore one by one and continue to require
public and institutional attention along with
resource allocations.

• Two major contemporary concerns that

require focus in any development initiative are
that of human security and sustainability.
• Development does not mean social
dislocation, violence and war and that we
meet “the needs of the present generation
without compromising the ability of future
generations to meet their own needs”.
 Purpose of development
• The purpose of development should be to
develop man and not to end with developing
things.

• Fulfillment of basic needs of mankind should be

the true objective of development and
achievements that either do not contribute to
this goal or even disrupt this basic requirement
must not be pursued as a development goal.
 • Thank You

• Any Queries?????
Development of Societies
HSMC 101-18

Unit 3: Economic Development

E. F. Schumacher's idea of development,

Buddhist economics.
93
E. F. Schumacher's idea of Great admirer of
Ghandi Ji
development

Gandhian
Buddhist idea of
economics development

1. Decentralization
2. Swaraj
 E. F. Schumacher's idea of
development
• Born in Germany, but being against Hitler, moved
to England. Resided and worked there.

• Considered to be among greatest of Economist of

all times.

• Developed the concepts of :-

―intermediate technology - making use of
locally available resources.
―small is beautiful.‖
• In 1995, he travelled to Burma (now
Myanmar) as an eco consultant there, where
he developed the principle of “Buddhist
Economics”.

• Buddhist Economics is formed from the two

words: Buddhist and Economics.

Buddhist refers to the Economics is a subject studying

teaching of Buddha human behavior related to the
consumption of goods and
services for survival as well as
beyond that level.
 Buddhist economics
• “Production from local resources for local
needs is the most rational way of economic life
and growth”.

• i.e., against Machine Revolution & harm to the

environment, labor.

• Right Livelihood

• Spiritual and philosophical

approach to the study of
Economics.
• It is revolutionary in the fact that it stress upon work
to be – meaningful
– Creative No Stress

• It is Successful because:-
1. Focus on health & well being of individual
2. Beneficial to the environment

i.e., Locals work Create from Self Growth

Locally Local Resources +
Preserve
Environment
 Differences between traditional and
Buddhist economics
Sr. No. Traditional Economics Buddhist economics
1 Concentrates on Self Interest Concentrates on Community Interest

2 Target MAX profit Target MIN suffering

3 Maximize material wealth Limited to Basic necessities – food, shelter,

clothing, etc.
4 Reliance upon machinery to reach Self Work
maximum production.
5 GOAL: - Bigger is Better GOAL:- Small is beautiful
i.e. Less is more.

Also a book with same name “Small is

beautiful.”
6 No focus on the Environment Prime focus on Environment Conservation.
• Buddhist economics aims to clear the
confusion about what is harmful and what is
beneficial in the range of human activities
involving the production and consumption of
goods and services, ultimately trying to make
human beings ethically mature.
 • Thank You

• Any Queries?????
Development of Societies
HSMC 101-18

Unit 3: Economic Development

Gandhian idea of development.

Swaraj and Decentralization.

102
E. F. Schumacher's idea of Great admirer of
Ghandi Ji
development

Gandhian
Buddhist idea of
economics development

1. Decentralization
2. Swaraj
 E. F. Schumacher
• Born in Germany, but being against Hitler, moved
to England. Resided and worked there.

• Considered to be among greatest of Economist of

all times.

• Developed the concepts of :-

―intermediate technology - making use of
locally available resources.
―small is beautiful.‖
Schumacher –

• Great admirer of Gandhi Ji.

• Incorporated Gandhi ji’s ideas in his work globally.

2 main concepts of Ghandi ji incorporated

1. Decentralization 2. Swaraj

Gandhian Idea of Development

Centralization Decentralization
 Decentralization
• Basic activities carried out at various levels giving
adequate scope to all participate and gain from it.

• i.e., No entire control of Government /

one company & distribution to all

• Eg:- Small – Village

Medium – Town/Cities (Production Units)
Large - Metros
• The process of transferring and assigning
decision making authority to lower levels of
an organizational hierarchy.

• Knowledge, ideas and information are flowing

from the bottom to the top of the
organisation.

• The span of control of top managers is

relatively small.
 Decentralisation has both political and economic
dimensions.

Political Economic
Decentralisation Decentralisation

•different levels of government • various economic activities

concerned with production,
• distribution of powers and distribution and exchange.
functions at various levels of
government • sizes- small, medium and large-
owned by a large group of people
• such as national, state and and distribution of production
local levels. through various channels.
 The four elements of decentralisation
observed are:
1. Decentralisation in decision-making:

• Gandhi’s system is based on village republic or village

panchayat. Here the people of the village participate in the
decision-making process.

• All economic, political and social decisions related to the

life of the people are taken by the people.

• Decentralisation thus implies giving power to the people to

take decisions that affect their lives.
2. Decentralisation of structure of production:

• Decentralisation of production structure implies production in a

large number of small and cottage industries.

3. Decentralisation of ownership of means of production:

• Economic decentralisation implies ownership of means of

production by the masses. The village is a production unit.
The production is organised in small and cottage industries,
spread over different sectors operating with labour-
intensive technology.
4. Decentralisation of location of production:

• The plan of rural industrialization involves

organization of production in small units spread over
the rural areas in the country.

• The distribution is thus equalized when production is

spread over geographical area in local units.
ADVANTAGES OF DECENTRALISATION
1. Promotes small industries - Decentralisation
promotes development of small industries
using local raw materials and utilises simple
tools and implements.

2. Equitable distribution of wealth – Equal

selling of things
3. Solves Labour Problems - Cottage industries
generate employment in congenial occupations in
the natural setting of the worker’s own place of
habitation which has many secondary and tertiary
moral, physical and material benefits.

4. No problem of Strikes/ lock outs - production

stability is maintained and therefore, there is
balance between production and consumption

5. Peace and Harmony - Everybody is earning.

Small industries

more employment

more wages

more Demand

more production
 SWARAJ

Freedom and self-rule

Swaraj can mean generally self governance or “home-rule”

(swa- “self’, raj- “rule”)

(1) In case of individual Swaraj, it is self-control
or Swaraj of the self.

(2) In case of the country, it is the freedom of

India from the British clutch, and

(3) in case of community level, it is Grain Swaraj

or freedom of village.
• Twin Objective: -
1. Empowering Self
2. Empowering State

Means giving full right or freedom to

people to work collectively, making them
masters of their work.
 Advantages of SWARAJ

1. Promotes small industries

2. Equitable distribution of wealth

3. Solves Labour

4. No problem of Strikes/ lock outs

5. Peace and Harmony

 • Thank You

• Any Queries?????