Structural Analysis of the Indian Economy Based on Conventional and Modified Input-Output Models

This paper attempts to explore structural changes of the Indian economy over the decade of the 1980s through 2006-7, using the Conventional and Modified Input-Output frameworks. Key sectors are identified using weighted backward and forward linkage measures and coefficients of variation. Results based on the Conventional model reveal structural change towards more or less modern production structure of the Indian economy, while that based on the Modified model reflects a mix of traditional and modern industry-oriented production structure. Results based on the Conventional method suggest policies that would focus more on the industrial sector, while those of the modified framework suggest that importance should be given to the traditional as well as modern industrial sectors. Thus, choice of the method of structural analysis for an economy is an important research agenda in the literature on the subject.