The Role of Narratives in the Analysis of Economic Growth: A Reflection from India’s Growth Narrative since 1980s

Abstract

This paper focuses on the epistemic importance played by ‘narratives’ in economic analysis and their role in enhancing economic growth, discussing the case of India’s own ‘growth narrative’ emerging from the late 1980s. A closer study of the role of ‘narratives’ in economic analysis offers a historical understanding of economic concepts both, in theory and praxis. The Indian growth narrative (from the late 1980s) saw a marked shift towards a ‘pro-market’ approach in terms of reforms in trade and economic liberalization, governed by principles of the Washington Consensus.

While this structural economic shift allowed India’s economy to boost its growth performance across a few sectors (particularly, services), the change in this narrative caused lop-sided economic fluctuations across various socio-economic indicators. The paper highlights some of the key areas of socio-economic divergences, emerging from the early 1990s (after the 1991 reforms) apparent from a rise in wage inequality levels across sectors; a lack of growth of employment opportunities and the rise in gender inequality across the country.

The rise in gender-based inequality (rural-urban areas) gets particular attention here in period after 2000s from the evidence gathered on decline in female-male labor force participation rate, disproportionate literacy rates (at secondary, tertiary levels of education), increasing intra-household inequality etc.

Keywords: Indian Economy, Economic Growth, Narratives, Economics, Development Studies

JEL Classification: N00, N15, O43, O40, O53, Z28