Infrastructure development and economic growth in China

China is the fastest growing country in the world for last few decades and one of the defining features of China's growth has been investment-led growth. China's sustained high economic growth and increased competitiveness in manufacturing has been underpinned by a massive development of physical infrastructure. In this context, we investigate the role of infrastructure in promoting economic growth in China for the period 1975 to 2007. Overall, the results reveal that infrastructure stock, labour force, public and private investments have played an important role in economic growth in China. More importantly, we find that Infrastructure development in China has significant positive contribution to growth than both private and public investment. Further, there is unidirectional causality from infrastructure development to output growth justifying China's high spending on infrastructure development since the early nineties. The experience from China suggests that it is necessary to design an economic policy that improves the physical infrastructure as well as human capital formation for sustainable economic growth in developing countries.

Children and economic development: Family size, gender preferences and human capital formation - theory and Indian cases

In the light of Gary Becker's economic theory of the family, considers how economic cost and benefit factors can influence the size of families that parents decide to have. Some support for the importance of such factors is found from results of structured interviews with wives in Kondh-dominated villages in western Orissa. These results are at variance with the hypothesis of Malthus about population growth. Factors that may alter the optimal family size as development proceeds are discussed. It is found in our sampling that, on the whole, there is a preference for daughters rather than sons although this is not as strong in the Kondh-dominated villages as in poor villages in the Santal tribal belt of West Bengal. While in the Kondh-dominated villages some discrimination in access to education in favour of boys compared to girls is present, little such or no such discrimination occurs in relation to access to food and medical attention. In the villages surveyed in the West Bengal Santal tribal belt, discrimination in favour of boys is more pronounced than in the Kondh-dominated area in Orissa. While economic considerations help to explain gender discrimination between boys and girls, we find that social and cultural factors also play a major role. Parents in a similar economic situation seem to display substantially different patterns of gender discrimination between children depending on their social and cultural content. It seems that the extent to which economic theories of the family explain family preferences and behaviour depend significantly on the social and cultural context in which they are to be applied.

Education's role in economic development and in assisting the poor

Much faith has been put in the increased supply of education as a means to promote national economic development and as a way to assist the poor and the disadvantaged. However, the benefits that nations can obtain by increasing the level of education of their workforce depends on the availability of other forms of capital to complement the use of its educated workforce in production. Generally, less developed nations are lacking in complementary capital compared to more developed ones and it is appropriate for less developed countries to spend relatively less on education. The contribution of education to economic growth depends on a nation’s stage of economic development. It is only when a nation becomes relatively developed that education becomes a major contributor to economic growth. It is possible for less developed nations to retard their economic growth by favouring investment in educational capital rather than other forms of capital. Easy access to education is often portrayed as a powerful force for assisting the poor and the disadvantaged. Several reasons are given here as to why it may not be so effective in assisting the poor and in promoting greater income equality even though the aim is a worthy one. Also, an economic argument is presented in favour of special education for the physically and mentally handicapped. This paper is not intended to belittle the contribution of education to economic development nor to devalue the ideal of making basic education available to all. Instead, it is intended as an antidote to inflated claims about the ability of greater investment in education to promote economic growth and about the ability of more widespread access to education to reduce poverty and decrease income inequality.