UNIT – II

Population Growth

Meaning

An increase in the number of people that reside in a country, state, county, or

city. To determine whether there has been population growth, the following
formula is used: (birth rate + immigration) - (death rate + emigration). Businesses
and governmental bodies use this information to make determinations about
investing in certain communities or regions.

Causes of Population

Causes of high birth rate

Causes of fall in the death rate

Causes of high birth rate

 Pre –dominance of agriculture

 Slow Urbanization
 High incidence of poverty
 Compulsory Marriages
 Early Marriage
 Religious beliefs and superstitions
 Joint family system
 Illiteracy

Pre –dominance of agriculture

India is predominantly agrarian economy. In an agrarian economy, children are

considered assets and not burdens as they help in agriculture fields.
Slow Urbanization

The process of urbanization is slow in India and it has failed to generate social
forces, which force people to have small families.

High incidence of poverty

There is high incidence of poverty in India. Poor people tend to have large
families as they consider every child as an earning hand.

Compulsory Marriage

Marriage is both religious and social necessity in India. Presently in India by the
age of 50 only 5 out of 1,000 Indian women remains unmarried. More marriages
mean more population.

Early Marriages

Not only marriages are almost compulsory, they take place at quite young age in
India, which provides more time for women to give birth to children.

Religious beliefs and superstitions

Most Indians on account of their religious and social superstitions desire to have
more children having to regard to their economic conditions. Every child is
considered as “ Gift of God”.

Joint Family system

Jonit family system in Indian also encourages people to have large families.

Illiteracy
 Lack of education among people especially among women causes people to
have irrartional attitudes and hence big families.

Causes of fall in Death Rate

 Control over famine

 Control over epidemics
 Other factors

Control over famine

Famines, which were wide spread before Independence, have not occurred on
a large scale since Independence.

Control over epidemics

Cholera and small pox often resulted in epidemics before Independence. Now
small pox is completely eradicated and cholera is very much under control.
Similarly there has been decline in the incidence of malaria and tuberculosis. These
have resulted in reducing the death rate.

Other factors

Other factors which have reduced the death rate are:

Spread of Education

Expanded medical facilities

Improved supply of potable water

Improvement in nutritional level.

Effects of Population
Problem of investment requirement

Indian population is growing at a rate of 1.8% p.a. In order to achieve a given

rate of increase in per capita income, larger investment is needed. This adversely
affects the growth of the economy.

Problem of Capital Formation

Composition of population in India hampers the increase in capital formation.

High birth rate and low expectancy of life means large number of dependents in
the total population. In India 35% of population is composed of persons less than
14 years of age. Most of these people depend on others for subsistence. They are
unproductive consumers.

Effect on Per capita income

Large size of population in India and its rapid rate of growth results in low per
capita availability of capital.

Problem of Unemployment

Large size of population results in large army of labour force but due to
shortage of capital resources it becomes difficult to provide gainful employment to
the entire working population.

Low standard of Living

Rapid growth of population accounts for low standard of living in India. Even
the bare necessities of life are not available adequately.

Poverty
 Rising population increases poverty in India. People have to spend a large
portion of their resources for bringing up of their ward. It results into less saving
and low rate of capital formation.

Effect on Food Problem

Rapid rate of growth of population has been the root of food problem.

Remedial Measures

Using various means of communications to persuade people to adopt the small

family norm of one or two children.

Making available family planning methods through different outlets in urban,

semi- urban and rural areas.

Establishing of family planning centers to make available the various services

related to family planning.

Financial assistance to acceptors and motivators of family planning methods like

sterilization.

Making health services available to lower morality among infants.

Provision of nutrition, immunization and other protective and preventive

measures against diseases, etc.

Promoting female education and employment.

Promotion of delayed marriages.

Arrangement for education in health and biology reproduction.

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 POVERTY

Poverty: Meaning, Causes, Effects, and Control Measures

Meaning:
Poverty refers to the extreme situation of scarcity of essential items that
people don’t even get the adequate food, clothing, medicines, shelter, for
subsistence existence.
Poverty can either be relative or absolute because whereas other people may
be comfortable with their lives, they may be deemed to be living in poverty when
compared against those who are extremely wealthy.

Poverty line
Poverty line is the level of income to meet the minimum living conditions.
Poverty line is the amount of money needed for a person to meet his basic needs. It
is defined as the money value of the goods and services needed to provide basic
welfare to an individual.

Causes of poverty

1. Overpopulation. The disproportionate rise in population leads to a situation

when the demand is high and the supply is limited results into acute shortage of
essential commodities.

2. Low agricultural output. The low agricultural output of crops results into
inadequate supply of food grains.
3. Low production of industrial products. The low industrial productivity of
essential items of daily use such as clothes, cooking utensils, etc. makes these
items unaffordable for poor people.

4. Diseases: There is constant risk of breakage of diseases in unhygenic

environment. These diseases affect the poor people very badly.

5. Flood and drought situation: The flood and drought situation causes heavy
losses to the agriculturalist. When the food crops gets destroyed, it leads to
shortage of food products. The flood also harms the hut and other shelter of poor
people.

6. Illiteracy: Educated people get better opportunity to work. Illiterate people are
often forced to do menial jobs.

7. Caste system: The division of labor on the basis of caste acts as a hurdle for the
poor people who want to come out of poverty level.

8. Untouchability: The problem of untouchability is further worsening the

condition of these poor people. These people are not allowed to undertake many
professions and are forced to live life in misery.

9.Gender Inequality: There is prevalence of gender based inequality against

women in various social, economic and religious activities. Women are not
allowed to undertake economic activities. At workplaces, they get inadequate
remuneration. This is leading to a condition called ‘Feminization of poverty’.
Effects of Poverty
Poverty has so many negative effects on both the individual and the society.
These are some fo the reasons why poverty is not a good thing:
1. Hinders economic prosperity of the nation: The economic growth of a
country is mostly driven by the business ventures of its citizens. If many of them
are poor, the country will be underdeveloped.

2. Crimes: It has been established that crime rates are usually higher in areas or
countries with high levels of poverty compared to those that are experiencing rapid
economic growth and good amounts of income per household.

3. Malnutrition: Insufficient food and the inability to afford a decent meal results
in malnutrition. Many people who live in poverty forego several meals and
sometimes when they eat, the food lacks essential nutrients necessary for good
growth.

4. Health problems: Many people living in poverty are unable to afford good
healthcare. They are therefore plagued by different health problems since they
cannot afford treatment. The poor living conditions may also cause diseases.

5. Less liberty: They say money is not everything but nevertheless, it is important
to have it. It can afford you the best things in life and give you different options to
choose from. Poor people do not get to choose their professions because they have
to make do with what is available. Many will get you a good education and make it
possible to study the career of your choice.
6. Moral and self-esteem: This is something that is easy to observe in a social
setup. Those who live in poverty usually feel like they do not have the moral
authority to demand better services or ask that they are treated fairly. Many of
them also suffer from low self-esteem because they think that they are not good
enough.

7. Insufficient food and water: To eat, one has to have money to buy the food.
That is one luxury that those who live in poverty do not have. Poor areas have
insufficient food and lack clean water to use in the home.

8. Lack of basic amenities: Important public amenities such as good drainage

systems, piped water, schools, health centers, and personal amenities like heating
are things that those who live in poverty lack.

9. Stress: Increased social disturbances can cause stress. The mind will be at
constant war thinking of where to get the next meal, what the future holds or how
to overcome the different problems associated with poverty. A poor person rarely
experiences peace of mind.

10. Feminization of poverty: This is where the burdens of poverty are borne by
women. They are left with the responsibility of taking care of the children and
holding the family together.

Control Measures / Solutions

1. Free education: This opens up opportunities for many people and provides
individuals as well as families with a means to escape poverty. It is the ideal way
to break the cycle of poverty that has bedeviled several families.
2. Government grants: These can be in the form of free mid-day meals or even
scholarships. It eases the financial pressure on families and allows them to direct
the little money that they have towards business ventures.

3. Creation of job opportunities: A high rate of employment reduces the level of

poverty in a country. When more people are employed, many households also earn
incomes and live comfortably.

4. Vocation and Technical training: This is skill based training meant to equip
individuals within the society with technical skills to enable them become
entrepreneurs or professionally employed even without higher education. Such a
move would be key in uplifting the lives of people in rural areas and reducing
poverty levels.

5. Free medical care facilities: This would ensure that people living in poverty
have good healthcare services. It would also help keep them healthy and strong to
seek out money making opportunities. Staying healthy and active is very important
in fighting poverty and improving living standards.

6. Education about family planning: One interesting factor is that a lot of people
living in poverty have very large families compared to those who are considered to
be well off. Taking care of a big family requires resources. There is thus a need to
carry out civic education about the necessity of family planning.

7. Increase in earning capacity: Gradually and systematically increasing the

minimum wage should be the objective of every government. This will increase the
incomes earned and subsequently reduce poverty levels. There should also be laws
that deter employees from paying workers less than they deserve.
8. Women empowerment: Gender inequality should be abolished if the society is
to realize meaningful growth and development. Denying women the opportunity to
pursue financial success does the community no good. If anything, it compounds
the problems associated with poverty. Statistics has shown that regions with many
economically empowered women are more developed than those with glaring
gender disparities.

9. Low-cost loans: Cheap credit facilities will encourage the growth of small
businesses and provide people, especially those in rural areas, with a means to
escape poverty. Low-cost loans are essential for spurring economic growth in the
local community.

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UNEMPLOYMENT

Meaning of unemployment

Unemployment may be defined as “a situation in which the person is

capable of working both physically and mentally at the existing wage rate, but does
not get a job to work”.

In other words unemployment means only involuntary unemployment

wherein a person who is willing to work at the existing wage rate does not get a
job.

Types of unemployment

1. Structural Unemployment:
 Unemployment caused by structural change like growing population,
technology etc.

2. Frictional Unemployment:

This type of unemployment occur when population change from one job to
another.

3. Cyclical Unemployment:

People are thrown out from job due to a recession in the economy.

4. Disguised Unemployment:

People are employed but their marginal product is zero.

Eg: Agriculture

5. Voluntary Unemployment:

Though jobs are available some person may want to remain idle.

6. Seasonal Unemployment:

Some productive activities are carried out for certain duration of a year.

7. Technological Unemployment:

Technology always displaced some work lack of due to technology

changes.

Causes of unemployment
(i) Caste System:

In India caste system is prevalent. The work is prohibited for specific castes in
some areas.

In many cases, the work is not given to the deserving candidates but given to the
person belonging to a particular community. So this gives rise to unemployment.

(ii) Slow Economic Growth:

Indian economy is underdeveloped and role of economic growth is very slow. This
slow growth fails to provide enough unemployment opportunities to the increasing
population.

(iii) Increase in Population:

Constant increase in population has been a big problem in India. It is one of the
main causes of unemployment. The rate of unemployment is 11.1% in 10th Plan.

(iv) Agriculture is a Seasonal Occupation:

Agriculture is underdeveloped in India. It provides seasonal employment. Large

part of population is dependent on agriculture. But agriculture being seasonal
provides work for a few months. So this gives rise to unemployment.

(v) Joint Family System:

In big families having big business, many such persons will be available who do
not do any work and depend on the joint income of the family.
Many of them seem to be working but they do not add anything to production. So
they encourage disguised unemployment.

(vi) Fall of Cottage and Small industries:

The industrial development had adverse effect on cottage and small industries. The
production of cottage industries began to fall and many artisans became
unemployed.

(vii) Slow Growth of Industrialisation:

The rate of industrial growth is slow. Though emphasis is laid on industrialisation

yet the avenues of employment created by industrialisation are very few.

(viii) Less Savings and Investment:

There is inadequate capital in India. Above all, this capital has been judiciously
invested. Investment depends on savings. Savings are inadequate. Due to shortage
of savings and investment, opportunities of employment have not been created.

(ix) Causes of Under Employment:

Inadequate availability of means of production is the main cause of under

employment. People do not get employment for the whole year due to shortage of
electricity, coal and raw materials.

(xii) Inadequate Irrigation Facilities:

Even after the completion of 9th five plans, 39% of total cultivable area could get
irrigation facilities.
Measures
1. Increase in national wealth through industrialization: The real remedy lies
in an addition to the national wealth, in increased production of industrial goods. If
there are more industries, there will be more avenues for employment, particularly
for men and women with professional and technological training. Already the
River valley projects and power-plant projects are finding employment for a large
number of men.
If the unemployment of the rural people is to be tackled, emphasis should also be
laid on the revival of cottage industries. This will give part-time occupation to
agriculturists and relieve the poor people who depend on these small decaying
industries such as weaving, making carpets and mats or utensils of ball-metal.

The Government alone can help them with loan and find a market for their goods.
If these industries are revived, the rural people will live in happiness and peace.

2. Establishment of Vocational and Technical training institutes: The

government should open Technical and Vocational colleges and manual labor
should be made compulsory. Big factories should be attached to these colleges.
More stress is to be given to practical side.

3. Increased investment in heavy industries: Investment in heavy and basic

industries and consumer goods industries should be increased to provide more
employment with more production.

4. Revival of cottage and small scale industries: Cottage and small scale
industries should be developed. Subsidies and other incentives should be given to
private sector.
5. Modernization of agriculture: Modernization and mechanization of agriculture
should be done. Wastelands should be utilized.

6. Improved transport and communication: Rural works programs should be

increased means of transport and communication should be developed.

7. Self-employment should be encouraged: Government should take initiatives to

encourage self-employment. Young entrepreneurs should be assisted with hassle
free loans.

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Income inequality

Meaning

Income inequality is the unequal distribution of household or individual

income across the various participants in an economy. Income inequality is often
presented as the percentage of income to a percentage of population. For example.
A statistic may indicate that 70% of a country’s income is controlled by 20% of
that country’s residents.

Causes

Cause of economic inequality in India or the inequalities of income exist in

our society because of the following reasons:
 Lack of educational opportunities: Illiteracy is one of the single factor
that has kept our people idle and ignorant for centuries. So, such people
have not been able to earn just sufficient livelihood for themselves.
 Gap between rich and poor: There exists an increasing gap between rich
and poor. Rich people are able to increase their resources by earning huge
profits while income of poor people has not increased. This has widened
gap between them.
 Law of inheritance Some people inherit their parental property,
business, etc. They remain economically strong though out while poor
people inherit family debt and increased family burden. This increases
the inequality.
 The unequal and unjust land holdings in agriculture: It is an
important reason for rural inequality of income. Rich farmers have big
land holdings while some farmers have uneconomic land holdings.
 Increasing unemployment, underemployment and disguised
unemployment are responsible for inequalities of income.

Measures
Four important measures are the following:

1. Payment of Bonus:

Firstly, the payment of bonus (called annual payment) has been made
compulsory in every industry.

2. Ceiling on Land Holding:

 Secondly, a ceiling on landholdings has been imposed in the rural areas. Each
household (or family) is allowed to hold a certain amount of land. Any surplus
above this is taken over by the Government and is redistributed among the
landless workers and marginal farmers. Moreover, in 1976 a ceiling on urban
property has also been imposed.

3. Self-Employment Projects:

Moreover, various self-employment projects have been taken both in rural and
urban areas to solve the growing unemployment problem.

4. Transfer Payments:

Finally, various types of transfer payments (such as unemployment,

compensation, soft loans, pensions to freedom fighters, concessions to senior
citizens, etc.) have been made for improving the welfare of certain weaker
sections of the society.

Effects
a) Class-conflict:
It has created two sections in society—the ‘haves’ and the ‘have-not’s—which are
ever on the war path. This has resulted in ever mounting social tensions and
political discontent.

(b) Political Domination:

The rich dominate the political machinery, and they use it to promote their own
exclusive interests. This results in corruption, graft and social injustice.

(c) Exploitation:
The rich exploit the poor. The consciousness of this exploitation leads to political
awakening and then agitation and even political revolution. Thus inequality of
incomes is an important cause of social and political instability.

(d) Creation of Monopolies:

Unequal incomes promote monopolies. These powerful monopolies and industrial
combines charge unfair prices from the consumer? And crush the small producers.
The bigger fish swallow the small fry.

(e) Suppression of Talent:

It is said that ‘slow rises merit by poverty depressed’. It is not easy for a poor man
to make his way in life, however brilliant he may be. It is a great social loss that
brainy people without money are unable to make their due contribution to social
welfare.

(f) Undemocratic:
Democracy is a farce when there is a wide gulf between the rich and the poor.
Political equality is a myth without economic equality.

(g) Moral Degradation:

The rich are corrupted by vice and the poor demoralized by lack of economic
strength. Thus inequalities spoil the rich and degrade the poor. Vice and corruption
rule such a world. The poor man finds it almost impossible to regain the virtues of
honesty and integrity. Human dignity is lost altogether.

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