World Wars and their impact on Indian Economy

World wars always had deeply affected the Indian Economy be it was WW1 or WW2. The reason people don’t talk much about the India and its economy in First World War is that many assume that India was not attached with it, which is quite the contrary. WW2 had much serious implications because it had curtailed India’s trade policies within the commonwealth of Britain and ended India’s touch with European nations. The First World War…

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How accessible banking would mean growth for India

Financial Inclusion – How accessible banking would mean growth for India Poverty’ by definitions is, a state of scarcity of essential resources needed for a comfortable survival and Financial inclusion means giving opportunities of affordable and easily accessible banking facilities and credit to people. Before I begin to elaborate upon how the inclusion of poor will lead to our country’s growth, it is very important to analyze the present scenario of our country. In a…

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Six Worst recessions ever

Weimar Germany (hyperinflation of the 1923) After the World War I, Germany faced strong political and financial instability. The German treasury was all empty due to the world war outlay. The government with the inability to raise proper amount of taxes so that the economy blooms up again, the German government started printing money. But it didn’t go as such, the huge amount of money pumping in the economy caused hyperinflation, the prices skyrocketed which…

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Asymmetric information and how to profit in markets

In economics, information asymmetry or asymmetrical information occurs when one party to a transaction has more or better information than the other party. Asymmetric information is a cause of market failure in many different areas. One of most commonly used example is the market for used cars. A new car may be worth a high amount but if the buyer of that car wishes to sell it almost immediately after purchase its value drops sharply. This is…

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Death Valley Curve – What it means for Start ups and how to avoid

“Death Valley Curve” is a jargon used in start-up financing referring to the period during the initial investment in a start-up when the firm is not generating sufficient revenues to meet the expenses, and could be paralyzed unless they raise more capital. In short, it is the financial risk faced by start-ups to survive the initial years of their business, and become profitable in the future. The dip of the curve shows the negative values…

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A Brief History Of OPEC

The Organization of the Petroleum Exporting Countries (OPEC) in an international organization which has its headquarters positioned in Vienna, Austria. OPEC’s mandate is to “coordinate and unify the petroleum policies” of its members and to “ensure the stabilization of oil markets in order to secure an efficient, economic and regular supply of petroleum to consumers, a steady income to producers, and a fair return on capital for those investing in the petroleum industry.” The history…

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Fiscal Responsibility and Budget Management Act (FRBMA)

The Fiscal Responsibility and Budget Management Act, 2003 (FRBMA) is an act of the parliament of India to infuse financial discipline, reduce India’s fiscal deficit, improve macroeconomic and the overall management of the public funds by moving towards a balanced budget. Indian economy faced with the predicament of large fiscal deficit and its monetisation spilled over to external sector in the late 1980s and early 1990s. The large borrowings on part of the government led to such a dangerous situation that…

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What is Green GDP

Green Gross Domestic Product also known as Green GDP, accounts for the environmental consequences of a country’s traditional GDP. It acts as an index of the growth of economy with the environmental implications of that growth which is related to a country’s conventional GDP. Green GDP tells us the biodiversity that is lost from a country and costs associated with climate change. The reason why green GDP was evolved is that the conventional GDP has…

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India’s ‘Plan Holiday’ from the 5 year plans

For any nation to progress and flourish it must have some economic framework that makes the smooth functioning of the country’s economy. Now when we talk about economic planning the main emphasis of the governments is to make full utilization of the countries resources. Full utilization is made by drawing up economic plans that guide us to it. Now according to HD Dickinson economic planning was “the making of major economic decisions -what and how…

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Harrod v/s Solow Model of Economic growth

Harrod v/s Solow Model of Economic growth

Developed after the Keynesian model of economic growth, Harrod-Domar model aims to tell us the economies rate of growth by telling us in terms of savings and increase in capital. The true essence of this model is based on the assumption that there is actually no valid reason that can be explained naturally for an economy to develop in a balanced fashion. The founders of this theory were Roy F. Harrod and Evsey Domar .…

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