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A Study on Regional Disparity of Devolution of Rural Infrastructure Development Fund - Evidence for India

Author

Listed:
  • Sen, S K
  • Guha, S
  • Chakraborty, N

Abstract

The present paper attempts to examine the normative criteria of RIDF devolution by NABARD in reducing inter and intra state disparity in terms of sanction of per capita RIDF over the study period 1996 to 2010. Following Spiezia (2002), Adjusted Geographic Concentration index has been used to test the nature and sources of concentration of per capita sanction of RIDF. The empirical findings support a relatively high degree of concentrations in devolution of such fund among the states. The study also identifies the sources of such concentration. The underlying reasons behind such inter and intra state disparity in per capita sanction of RIDF is mainly the matching grant scheme applied to all the states and the twenty percentages reward formula under such devolution criteria. This study strongly recommended the review of the normative criteria for devolution of RIDF set by the NABARD by removing the matching grant scheme and restricting the twenty percentage reward formula, for the less developed states including the states in the north eastern region only for achieving the goal of balanced regional development of rural infrastructure.

Suggested Citation

  • Sen, S K & Guha, S & Chakraborty, N, 2011. "A Study on Regional Disparity of Devolution of Rural Infrastructure Development Fund - Evidence for India," MPRA Paper 39117, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:39117
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    References listed on IDEAS

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    1. Shenggen Fan & Peter Hazell & Sukhadeo Thorat, 2000. "Government Spending, Growth and Poverty in Rural India," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(4), pages 1038-1051.
    2. Fan, Shenngen & Hazell, Peter & Haque, T., 2000. "Targeting public investments by agro-ecological zone to achieve growth and poverty alleviation goals in rural India," Food Policy, Elsevier, vol. 25(4), pages 411-428, August.
    3. Binswanger, Hans P. & Khandker, Shahidur R. & Rosenzweig, Mark R., 1993. "How infrastructure and financial institutions affect agricultural output and investment in India," Journal of Development Economics, Elsevier, vol. 41(2), pages 337-366, August.
    4. Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(2), pages 407-443.
    5. Ellison, Glenn & Glaeser, Edward L, 1997. "Geographic Concentration in U.S. Manufacturing Industries: A Dartboard Approach," Journal of Political Economy, University of Chicago Press, vol. 105(5), pages 889-927, October.
    6. Raghbendra Jha, 2002. "Rural Poverty in India: Structure, determinants and suggestions for policy reform," ASARC Working Papers 2002-07, The Australian National University, Australia South Asia Research Centre.
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    More about this item

    Keywords

    Rural Infrastructure; Regional Disparity; Geographic Concentration; Matching Grant Scheme; Reward Formula;
    All these keywords.

    JEL classification:

    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs

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