Political Economy of development PDF

Running head: POLITICAL ECONOMY OF DEVELOPMENT
Political economy of development
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POLITICAL ECONOMY OF DEVELOPMENT1
Executive summary:
This report is aimed to discuss to what extent the role of the state can be beneficial for
creating the imbalanced nature of growth distribution resulted from the capitalist system.
From the discussion it has been seen that the capitalism economy is one of the differentiated
form of the government that operates under the free market operation in order to enhance
their profit through maximising the revenue. To conclude the report depicts that the
capitalism give rise to exploitation and imperfect resource allocation and it grows the gap
between the different economies too.

POLITICAL ECONOMY OF DEVELOPMENT2
Table of Contents
Introduction:...............................................................................................................................3
Definition of capitalism:............................................................................................................4
Capitalism from the perspective of India:..................................................................................4
Viewpoint of the capitalism from the Indian point of view:......................................................7
Imbalanced growth distribution by the capitalist system in India:..........................................10
Exploitative nature of the capitalist system in nature:.............................................................10
Conclusion:..............................................................................................................................12
References:...............................................................................................................................14

POLITICAL ECONOMY OF DEVELOPMENT3
Introduction:
Capitalism is often argued as the economic system where the private players are
allowed to control and own the use of the property as per their own interest. In addition to
this, capitalism works with the influence of the invisible hand of pricing framework that
coordinates in between the supply and demand of the market in such a way that automatically
enhance the social benefit (Tawney 2017). However, there is certain amount of ambiguity
regarding the performance of the capitalism and how it can enhance the social benefit
utilising the pricing mechanism where the framework is dependable upon the invisible hand.
There are various argument regarding the benefit and drawbacks of the same, however, since
the growth of the industrialisation era, capitalism gained its momentum (Commons 2017).
Government in this perspective is generally mentioned as the responsible justice, peace and
flow of the market utilising its interventionist policies. Though there are many researchers
like Hodgson 2016), who has argued that government do more harm with the interventionist
policy than doing good to the society. Government through their intervention allows the
capitalist firm to exploit the land, labour and capital, which are the key instrument of the
production (Dirlik 2018). Contrary to this, many economists has argued that growth of the
capitalism according to the demand and supply pull rather aids the economy to achieve higher
benefit, where the government acts as the market correcting organisation that intervene the
market in order to check the exploitation (Williams 2014). Considering the case of the
developing countries like India it can be seen that capitalism has taken corroded form that has
made it crony capitalism. Allocation of public goods become highly biased leading to Marxist
idea a failed case in the developing nations.
Under this context, this report is aimed to discuss the capitalism system and its
performance of the same in presence of the governmental intervention. Main focus of this
report will remain on the fact to discuss to what extent the role of the state can be beneficial