While there is now consensus that liberalizing reforms have been behind the acceleration of growth in India to the current 8 to 9 percent level, critics continue to argue that opening the economy to trade has hurt the poor, that rapid growth is leaving the socially disadvantaged groups behind, and that the reforms have led to increased inequality. They also argue that people themselves do not feel that their fortunes are improving. Five original essays in this volume, topped by a substantial introductory essay summarizing their findings, meet these challenges to the reforms head-on. They use l ... More

While there is now consensus that liberalizing reforms have been behind the acceleration of growth in India to the current 8 to 9 percent level, critics continue to argue that opening the economy to trade has hurt the poor, that rapid growth is leaving the socially disadvantaged groups behind, and that the reforms have led to increased inequality. They also argue that people themselves do not feel that their fortunes are improving. Five original essays in this volume, topped by a substantial introductory essay summarizing their findings, meet these challenges to the reforms head-on. They use large-scale sample surveys and other data to systematically address each of these arguments. They show that trade openness has indeed helped reduce poverty not just in general but also among the socially disadvantaged groups. The contributors to the volume find no evidence whatsoever to support the claim of a negative impact of trade openness on poverty in any social group. The essays also show that inequality exhibits no definite trend since the liberalizing reforms and that it is unrelated to trade openness. People’s responses have also now turned decidedly in favor of reforms. Thus, when asked how they feel about the change in their fortunes in the recent past, an overwhelmingly large proportion of individuals from every conceivable group report improvements. Moreover, systematic analysis of the 2009 parliamentary elections show that people now reward the chief ministers in states in which they deliver superior growth outcomes and punish those that do not.