UPSC economics syllabus

UPSC Optional Paper Syllabus for Economics- Paper I

  1. Advanced Micro Economics :

(a) Marshallian and Varrasiam Approach to Price determination

b) Alternative Distribution Theories; Ricardo, Kaldor, Kaleeki.

(c) Markets Structure: Monopolistic Competition, Duopoly, Oligopoly.

(d) Modern Welfare Criteria: Pareto Hicks and Scitovsky, Arrow’s Impossibility Theorem, A. K. Sen’s Social Welfare Function.

  1. Advance Macro Economics :

➨ Approaches to Employment Income and Interest Rate determination: 

  • Classical, 
  • Keynes (IS)-LM) curve, 
  • Neo-classical synthesis and New classical, 
  • Theories of Interest Rate determination and Interest Rate Structure.
  1. Money-Banking and Finance :

(a) Demand for and Supply of Money: 

  • Money Multiplier Quantity Theory of Money (Fisher, Pique, and Friedman) 
  • Keyne’s Theory on Demand for Money, 
  • Goals and Instruments of Monetary Management in Closed and Open Economies. 
  • The relation between the Central Bank and the Treasury. 
  • Proposal for ceiling on the growth rate of money.

(b) Public Finance and its Role in Market Economy: 

  • In stabilization of supply, allocation of resources and in distribution and development. 
  • Sources of Government revenue, forms of Taxes and Subsidies, their incidence and effects. Limits to taxation, loans, crowding-out effects, and limits to borrowings. 
  • Public expenditure and its effects.
  1. International Economics :

(a) Old and New theories of International Trade.

  • Comparative advantage,
  • Terms of Trade and Offer Curve.
  • Product Cycle and Strategic Trade Theories.
  • Trade as an engine of growth and theories of underdevelopment in an open economy.

(b) Forms of Protection: 

  • Tariff and quota.

(c) Balance of Payments Adjustment: Alternative Approaches.

  • Price versus income, income adjustments under fixed exchange rates.
  • Theories of Policy Mix.
  • Exchange rate adjustments under capital mobility.
  • Floating Rates and their Implications for Developing Countries : Currency Boards.
  • Trade Policy and Developing Countries.
  • BOP, adjustments and Policy Coordination in open economy macromodel.
  • Speculative attacks.
  • Trade Blocks and Monetary Unions.
  • WTO: TRIMS, TRIPS, Domestic Measures, Different Rounds of WTO talks.
  1. Growth and Development :
  • Theories of growth : Harrod’s model;
  • Lewis model of development with surplus labour.
  • Balanced Unbalanced Growth.
  • Human Capitals and Economic Growth.
  • Research and Development and Economic Growth.

(b) Process of Economic Development of less developed courtries: 

  • Myrdal and Kuzments on economic development and structural change: 
  • Role of Agriculture in Economic Development of less developed countries.

(c) Economic Development and International Trade and Investment, Role of Multinationals.

(d) Planning and Economic Development: 

  • changing role of Markets and Planning,
  • Private-Public Partnership.

(e) Welfare indicators and measures of growth

  • Human Development Indices. 
  • The basic needs approach.

(f) Development and Environmental Sustainability

  • Renewable and Non-renewable Resources, 
  • Environmental Degradation, 
  • Intergenerational equity development.

UPSC Optional Paper Syllabus for Economics- Paper-II (Indian Economics in Post-Independence Era)

A. The Pre-Liberalization Era 
  • Contribution of Vakil, Gadgil and V.K.R.V. Rao.
  • Agricultrure : Land Reforms and land tenure system, Green Revolution and capital formation in agriculture.
  • Industry Trends in composition and growth, Role of public and private sector, small scale and cottage industries.
  • National and Per capita income : Patterns, trends, aggregate and sectoral composition and changes therein.
  • Broad factors determining National Income and distribution, Measures of poverty, Trends in poverty and inequality.
B. The Post-Liberalization Era 

(i) New Economic Reform and Agriculture 

  • Agriculture and WTO, 
  • Food processing, 
  • Subsidies, 
  • Agricultural prices and public distribution system, 
  • Impact of public expenditure on agricultural growth.

(ii) New Economic Policy and Industry: 

  • The strategy of industrialization, 
  • Privatization, 
  • 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, 
  • the Twelfth Finance 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 planning and markets for growth and decentralized planning : 
  • 73rd and 74th Constitutional amendments.

(viii) New Economic Policy and Employment: 

  • Employment and poverty, 
  • Rural wages, 
  • Employment Generation, 
  • Poverty alleviation schemes, 
  • New Rural, Employment Guarantee Scheme.

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