Economic Growth & Human Development: The Experience of Indian States

This paper explores the links between economic growth and human development by identifying two chains based on Indian empirical evidence, one from economic growth to human development and the other from human development to economic growth. The results indicate that there are widening inter-regional disparities in human development over a long period of time. In the liberalization period the states showed a tendency of convergence rather than divergence in terms of human development. The empirical analysis reveals that there is a positive relationship between public expenditure and human development. The influence of public expenditure on human development is higher than that of economic growth. The empirical evidence is in support of the higher public expenditure on health and education that leads to higher human development.