Future Prospects

This chapter attempts to draw on the analysis of seven decades of data and evidence from Palanpur to indicate some predictions for the future. It suggests that all-India trends of expanding non-farm, informal, employment will continue to exert an influence in Palanpur. The central role of caste and landholding in driving distributional outcomes is predicted to gradually diminish over time. However, a critical question relates to the potential role that the currently high, and rising, inequality might play in locking-in the forces that perpetuate inequality. The chapter argues that there is an intense need for improvement in the public supply of education and health services. Given the still weak state of education outcomes and also still poorly developed availability of financial services, it argues that for the foreseeable future entrepreneurship will continue to draw primarily on households’ own resources and initiative.

Changing Activities, Changing Markets: Agriculture

This chapter examines in detail the process of agricultural development in Palanpur over seven decades. It identifies the factors that have played a significant role in shaping this process. The chapter shows that the evolution of agriculture in Palanpur involved, and was shaped by, the interactions amongst multiple factors, including demographic change, expansion of irrigation, intensification of cultivation, changing cropping patterns, farm mechanization, growing non-farm employment, marketization of factors of production, and improvements in formal credit supply. The importance of interactions between agriculture and non-agriculture, as well as within agriculture, is highlighted with respect to changing cropping patterns and intensification of mechanization and irrigation. It is also seen in institutional dynamism such as, for example, the emergence of new forms of tenancy. In providing a structured description of the changing contours of agriculture, important insights are obtained into how lives and livelihoods have changed in Palanpur.

The Study of Villages and the Understanding of Development

This chapter introduces the idea of the village study as a lens through which to examine and learn about economic development. The particular advantages of longitudinal village studies—tracking the village and its inhabitants over time—are described. The specific features of the Palanpur study, which make it unique and particularly valuable amongst longitudinal village studies in India, are highlighted. Amongst these are the long—seven-decade—duration of the study, the universal coverage of the village population, the wealth and quality of the quantitative data that has been collected, as well as the complementary availability of detailed qualitative information. The chapter reviews lessons for the general practice of household survey data collection and survey methods from the specific experience of the Palanpur study, highlighting the value of credibility and building a relationship of trust between field investigators and survey respondents.

Society and Politics

This chapter examines the village as a society and polity, showing how relations between different social groups in Palanpur have changed and how the interactions of institutions and politics with economic change can help explain the nature and evolution of society. It also looks at the state of public institutions in Palanpur, documenting a decay in the quality and provision of public services, as well as an absence of any significant collective action to change this. It would be overly simplistic to argue that, because caste relations were historically centred around agricultural production, they are weakening with the declining economic importance of agriculture. Rather, there has been an emergence of caste as a proxy for trust in an increasingly informal and anonymous labour market outside the village. Furthermore, exogenously imposed changes, such as the introduction of panchayat elections, have seen new alliances being built.

India and Palanpur

The seven decades of the Palanpur study cover India’s life as an independent nation. The chapter highlights those changes in India’s economy and policy that relate, and are relevant, to our understanding of Palanpur’s development. Amongst the key events in India’s history that are of particular pertinence in Palanpur are the land reforms of the 1950s associated with zamindari abolition, the green revolution, diversification of employment into non-farm activities, with increasing incomes in rural areas, the slow expansion of education, rapid population growth, changing social, political, and demographic structures, transformation in communications, liberalization, and the opening of the economy. These changes in the overall economic environment have constituted crucial context for, and forces behind, the changes observed in Palanpur. The seven decades of data and close know ledge of Palanpur also help to illuminate the overall story of India’s development and locate it in a specific and human context.

Human Development

This chapter documents that in Palanpur advances in human development have been slower than might have been expected on the basis of observed growth in incomes. Although there have been some improvements in human development indicators, particularly since the mid-1980s, the rate of improvement has been slower than in the rest of Uttar Pradesh and the rest of India. Improvements in literacy rates lag behind achievements recorded elsewhere, as do improvements in health and nutritional outcomes. Public services function poorly and in some respects are showing a decline. Inequities on the basis of income, caste, and gender are strong. With public services generally failing, there is an increased dependence on the private sector, but access is governed by ability to pay. A striking finding is that despite myriad reasons for concern there appears to be little protest within the village against the poor quality and availability of services.

Poverty, Inequality, and Mobility in Palanpur

Palanpur offers the rare opportunity to simultaneously examine levels and trends in poverty, inequality, and income mobility over an extended period. This chapter documents the evolution of these distributional outcomes and points to some striking changes over time. It shows that the forces of agricultural change and non-farm diversification have combined to generate rising per capita incomes and falling poverty in Palanpur. Such forces have also, in recent years, fostered social mobility, with some households from the traditionally poorest castes finding remunerative earning opportunities in the non-farm sector. However, income inequality has also risen sharply in Palanpur, and this process is also seen to have been strongly driven by the expansion of the non-farm sector. When a long-term perspective is taken, the chapter shows that intergenerational mobility—considered here in terms of the strength of association between the incomes of fathers and sons—has declined over the entire survey period.

Changing Activities, Changing Markets

This chapter examines the expansion of non-farm activities in Palanpur and shows that most non-farm employment growth can be attributed to an increase in casual and self-employment opportunities, as opposed to regular, salaried jobs. The construction sector has been particularly significant in this sense. (Lack of) access to land is an important predictor of involvement in the non-farm sector, but, conversely, growth in this sector has influenced certain households’ access to land, via its impact on tenancy patterns. At the household level, caste affiliation plays an important role in determining access to specific jobs, while education appears, so far, to play only a muted role. The chapter shows that in Palanpur, contrary to many textbook analyses, migration has played only a modest role in governing the shift out of agriculture, but highlights the importance of commuting as a means of accessing non-farm jobs while continuing to reside in the village.

Tenancy in Palanpur

This chapter examines, in detail, the nature and trends in tenancy in Palanpur. It explores the ways in which the evolution of tenancy is associated with land ownership patterns, landlord–tenant relations, castes, absent or missing markets, and employment in non-farm activities. The chapter starts with an examination of trends in tenancy and different types of contracts in Palanpur. It asks how broader developments within and around the village have affected the institution of tenancy. Patterns of tenancy and of tenancy contracts are also examined in relation to the caste and land ownership of the landlord and tenant. The importance of ‘communities of trust’ amongst villagers—often linked to caste—is highlighted. Such social mechanisms reduce the need for constant and direct monitoring of the tenant’s efforts by the landlord, and can help to explain why sharecropping remains a relatively popular tenancy contract.

Theory and India

This chapter examines theories of economic development and growth and asks how these can help in our understanding of the dynamics of changing individual circumstances in Palanpur. The core ideas of the Palanpur study, namely of non-farm diversification, evolving mobility and inequality, the responsiveness of institutions to change, sluggish progress in human development, and the critical role of entrepreneurship and initiative, are explored through the lens of conventional theories of development. Deficiencies in our conceptual understanding are identified (ways forward are suggested in Chapter 13). The chapter notes, however, that the rapidly growing fields of institutional and behavioural economics are particularly relevant to the Palanpur study and may come to offer important insights.