Paper

1. Advanced Micro Economics:

(a)
(b)
(c)
(d)
em,

Marshallian and Walrasiam Approaches to Price determination.

Alternative Distribution Theories: Ricardo, Kaldor, Kaleeki
Markets Structure: Monopolistic Competition, Duopoly, Oligopoly.
Modern Welfare Criteria: Pareto Hicks & Scitovsky, Arrow s Impossibility Theor
A.K. Sen s Social Welfare Function.

These topics have to be studied from HL Ahuja Advanced Microeconomics . Find the re
levant chapters to study from this thick book. In addition, questions are asked
on Rent, quasi rent and Product Exhaustion Problem , so study the relevant chapters a
lso. HL Ahuja is UPSC exam standard book for micro. Sen s swf and proof of Arrow c
an be studied from my notes. I took Sen s swf from one of his book and proof of Ar
row from one of Sen s paper. Proof of Arrow given in HL Ahuja and taught by most c
oachings is wrong, it is simply a proof of Concordet s paradox, not Arrow. Just im
agine, had the proof of Arrow been so elementary, would he have got the Nobel pr
ize for it?
2. Advanced Macro Economics: Approaches to Employment Income and Interest Rate d
etermination: Classical, Keynes (IS-LM) curve, Neo classical synthesis and New c
lassical, Theories of Interest Rate determination and Interest Rate Structure.
These topics should be first studied from HL Ahuja s Macroeconomics book. This book
is below UPSC exam standard, but reading this is essential to understand higher
concepts. The UPSC level book is Brian Snowdon and Howard R Vane Modern Macroecon
omics (given to me by Amit Sahu). Only first 5 chapters need to be studied from t
his book.
3. Money

Banking and Finance:

(a) Demand for and Supply of Money: Money Multiplier Quantity Theory of Money (F
isher, Pique and Friedman) and Keyne s Theory on Demand for Money, Goals and Instr
uments of Monetary Management in Closed and Open Economies. Relation between the
Central Bank and the Treasury. Proposal for ceiling on growth rate of money.
This can be studied from HL Ahuja s Macroeconomics and Snowdon s Modern Macroeconomi
cs (Ch 2, 3). Also, although UPSC doesn t mention post keynesian Baumol s and Invent
ory theory of money demand in syllabus, it asks questions on these. So read them
from HL Ahuja. There are some topics for which material may be scarce, read the
m from my notes.
(b) Public Finance and its Role in Market Economy: In stabilization of supply, a
llocation of resources and in distribution and development. Sources of Govt. rev
enue, forms of Taxes and Subsidies, their incidence and effects. Limits to taxat
ion, loans, crowding-out effects and limits to borrowings. Public Expenditure an
d its effects.
I studied from Musgrave and Musgrave, selected chapters. People also mention HL
Bhatia a lot. I was satisfied with my preparation until I saw the public finance
questions this year. I couldn t even understand the questions. I don t know where e
lse to study public finance from.
4. International Economics:
(a) Old and New Theories of International Trade
(i) Comparative Advantage
(ii) Terms of Trade and Offer Curve.

(iii) Product Cycle and Strategic Trade Theories.

(iv) Trade as an engine of growth and theories of under development in an open e
conomy.
(b) Forms of Protection: Tariff and quota.
(c) Balance of Payments Adjustments: Alternative Approaches.
(i) Price versus income, income adjustments under fixed exchange rates,
(ii) Theories of Policy Mix
(iii) Exchange rate adjustments under capital mobility
(iv) Floating Rates and their Implicationns for Developing Countries: Currency B
oards.
(v) Trade Policy and Developing Countries.
(vi) BOP, adjustments and Policy Coordination in open economy macro-model.
(vii) Speculative attacks
(viii) Trade Blocks and Monetary Unions.
(ix) WTO: TRIMS, TRIPS, Domestic Measures, Different Rounds of WTO talks.
There is only one book on International Economics and it is by Dominick Salvator
e. Diagrams are the key in IntEco.
5. Growth and Development:
(a) Theories of growth:
(i) Harrod s model,
(ii) Lewis model of development with surplus labour
(iii) Balanced and Unbalanced growth,
These topics are covered well in A P Thirwall s book. Todaro may also be referred
for some topics.
(iv) Human Capital and Economic Growth.
(v) Research and Development and Economic Growth
These are dicey topics and cover many models. I studied them from a paper by Joh
n Bluedorn The human capital augmented solow model and a book Introduction to Econo
mic Growth by Charles I. Jones (given to me by Amit Sahu).
(b) Process of Economic Development of Less developed countries: Myrdal and Kuzm
ents on economic development and structural change: Role of Agriculture in Econo
mic Development of less developed countries.
Myrdal and Kuznets can be studied from AP Thirwall. Not all aspects of Myrdal ar
e covered in Thirwall, I had one pdf I found after googling on Myrdal which cove
red aspects like how less developed economies have backwash effects strong and h
ow developed democracies have stronger spread effects, I don t seem to have the pd
f now.
(c) Economic development and International Trade and Investment, Role of Multina
tionals.
(d) Planning and Economic Development: changing role of Markets and Planning, Pr
ivate- Public Partnership
(e) Welfare indicators and measures of growth
ic needs approach.

Human Development Indices. The bas

(f) Development and Environmental Sustainability Renewable and Non Renewable Res
ources, Environmental Degradation, Intergenerational equity development.

These are general topics and haven t found a single source for them so far. Very l
ittle preparation.
Paper

II

1. Indian Economy in Pre-Independence Era: Land System and its changes, Commerci
alization of agriculture, Drain theory, Laissez faire theory and critique. Manuf
acture and Transport: Jute, Cotton, Railways, Money and Credit.
These I studied mainly from my hitory optional preparation for cse 2012. You can
see some in my notes.
2. Indian Economy after Independence:
A The Pre Liberalization Era:
(i) Contribution of Vakil, Gadgil and V.K.R.V. Rao.
Till date I have not found a single decent source to prepare this. I have never
been able to prepare this. If someone has a good source, pls let me know, I ll u
pdate here.
(ii) Agriculture: Land Reforms and land tenure system, Green Revolution and capi
tal formation in agriculture,
(iii) Industry Trends in composition and growth, Role of public and private sect
or, Small scale and cottage industries.
(iv) National and Per capita income: patterns, trends, aggregate and Sectoral co
mposition and changes their in.
(v) Broad factors determining National Income and distribution, Measures of pove
rty, Trends in poverty and inequality.
Uma Kapilla is a very good source for these topics. One should also focus on eco
nomic stats. Can also see my notes. Stats on efficacy of land reforms need to be
remembered (see my notes), stats on economic growth rate, growth rates of agric
ulture, industry, manufacturing, capital goods, services, per capita income need
to be remembered for 3 periods
1950s to 1965, 1965 to 1980, 1980 to 1990.
B The Post Liberalization Era:
(i) New Economic Reform and Agriculture: Agriculture and WTO, Food processing, S
ubsidies, Agricultural prices and public distribution system, Impact of public e
xpenditure on agricultural growth.
(ii) New Economic Policy and Industry: Strategy of industrialization, Privatizat
ion, Disinvestments, Role of foreign direct investment and multinationals.
(iii) New Economic Policy and Trade: Intellectual property rights: Implications
of TRIPS, TRIMS, GATS and new EXIM policy.
(iv) New Exchange Rate Regime: Partial and full convertibility, Capital account
convertibility.
(v) New Economic Policy and Public Finance: Fiscal Responsibility Act, Twelfth F
inance Commission and Fiscal Federalism and Fiscal Consolidation.
(vi) New Economic Policy and Monetary system. Role of RBI under the new regime.
(vii) Planning: From central Planning to indicative planning, Relation between p
lanning and markets for growth and decentralized planning: 73rd and 74th Constit
utional amendments.
(viii) New Economic Policy and Employment: Employment and poverty, Rural wages,
Employment Generation, Poverty alleviation schemes, New Rural, Employment Guaran
tee Scheme.
No single source. EPW helps. One also has to study a lot of research papers by e

minent economists working in India. I studied a lot of them n put the gist in my
notes. So can see my notes. Stats on poverty, unemployment (recent ones as well
as from 1993-94) need to be remembered. See notes.