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Class 11 commerce economics notes – complete details


Class 11 commerce economics notes – complete details

Class 11 commerce economics notes: Download CBSE class 11 commerce economics notes available here for free. Complete details CBSE class 11 commerce Economics Key notes and summary of the chapter with examples are available here

class 11 commerce economics notes – complete details

Class XI Commerce economics notes

Class XI Commerce economics notes

Class XI Commerce Economics notes and Syllabus

Part AStatistics for Economics 
2.Collection, Organisation and Presentation of Data
3.Statistical Tools and Interpretation27
Part BPart B: Indian Economic Development
4.Development Experience (1947-90) and13
Economic Reforms since 199112
5.Current Challenges facing Indian Economy15
6.Development Experience of India – A Comparison with Neighbours (OTBA)10
Part CProject Work10

Part A: Statistics for Economics

class 11 commerce economics notes: In this course, you are expected to acquire skills in collection, organisation and presentation of quantitative and qualitative information pertaining to various simple economic aspects systematically. It also intends to provide some basic statistical tools to analyse, and interpret any economic information and draw appropriate inferences. In this process, you are expected to understand the behaviour of various economic data.

Unit 1: Introduction

What is Economics?

Meaning, scope and importance of statistics in Economics

Unit 2: Collection, Organisation and Presentation of Data

Collection of data – sources of data – primary and secondary; how basic data is collected; methods of collecting data; some important sources of secondary data: Census of India and National Sample Survey Organisation.

Organisation of Data: Meaning and types of variables; Frequency Distribution.

Presentation of Data: Tabular Presentation and Diagrammatic Presentation of Data: (i) Geometric forms (bar diagrams and pie diagrams), (ii) Frequency diagrams (histogram, polygon and ogive) and (iii) Arithmetic line graphs (time series graph).

Unit 3: Statistical Tools and Interpretation

Measures of Central Tendency – mean (simple and weighted), median and mode

Measures of Dispersion – absolute dispersion (range, quartile deviation, mean deviation and standard deviation); relative dispersion (co-efficient of quartile-deviation, co-efficient of mean deviation, co-efficient of variation); Lorenz Curve: Meaning and its application.

Correlation – meaning, scatter diagram; Measures of correlation – Karl Pearson’s method (two variables ungrouped data) Spearman’s rank correlation.

Introduction to Index Numbers – meaning, types – wholesale price index, consumer price index and index of industrial production, uses of index numbers; Inflation and index numbers.

Part B: Indian Economic Development

Unit 4: Development Experience (1947-90) and Economic Reforms since 1991

Class 11 commerce economics notes: A brief introduction of the state of Indian economy on the eve of independence. Common goals of Five Year Plans.

Main features, problems and policies of agriculture (institutional aspects and new agricultural strategy, etc.), industry (industrial licensing, etc.) and foreign trade.

Economic Reforms since 1991:

Class 11 commerce economics notes: Need and main features – liberalisation, globalisation and privatisation; An appraisal of LPG policies

Unit 5: Current challenges facing Indian Economy

Poverty – absolute and relative; Main programmes for poverty alleviation: A critical assessment;

Rural development: Key issues – credit and marketing – role of cooperatives; agricultural diversification; alternative farming – organic farming

Human Capital Formation: How people become resource; Role of human capital in economic development; Growth of Education Sector in India

Employment: Formal and informal, growth and other issues: Problems and policies.

Inflation: Problems and Policies

Infrastructure: Meaning and Types: Case Studies: Energy and Health: Problems and Policies- A critical assessment;

Sustainable Economic Development: Meaning, Effects of Economic Development on Resources and Environment, including global warming.

Unit 6: Development Experience of India

A comparison with neighbours

India and Pakistan

India and China

Issues: growth, population, sectoral development and other developmental indicators.

Economics : Indian Economic Development

class 11 commerce economics notes: Chapter 1 – Unit I- Indian Economy on the Eve of Independence

  • What was the focus of the economic policies pursued by the colonial government in India? What were the impacts of these policies?

    • Class 11 commerce economics notes: The main focus of the economic policies pursued by the colonial government was to make India a mere supplier of Britain’s own flourishing industrial base. The policies were concerned mainly with the fortification and advancement for their home country. The interests of the Indian economy were completely ignored. Such policies brought structural changes in the Indian economy by transforming it to a supplier of raw materials and consumer of finished products from Britain. The impacts of these policies are discussed as follows in detail;Low Economic Development Throughout the British rule, Indian economy experienced very low level of economic development. As per some researches, Indian economy grew at even less than two percent during 1900-50. The reason for such a low level of development was that the British government was more concerned with the promotion of economic interests of their home country. Consequently, the colonial rule transformed India’s agriculture sector to a mere supplier of raw materials for the British industries. This not only affected the production of the agricultural sector but also ruined the small manufacturing units like handicrafts and cotton industries. These manufacturing units faced a stiff competition from the British machine made textiles and handlooms.Backwardness of Indian AgricultureUnder the colonial rule, India was basically an agrarian economy employing nearly 85% of its population. Nevertheless, the growth of the agriculture sector was meager. This was due to the prevalence of various systems of Land Settlement, particularly Zamindari system. Under this system, the zamindars (owners of land) were required to pay very high revenue (lagaan) to the British government, which they used to collect from the peasants (landless labourers, who were actually cultivating). The zamindars were mainly concerned with extracting high revenues from the peasants but never took any steps to improve the productivity of the land. Moreover, in order to feed British industries with cheap raw materials, the Indian peasants were forced to grow cash crops (such as, indigo, cotton, etc.) instead of food crops (such as, rice and wheat). This commercialisation of agriculture not only increased the burden of high revenues on the poor peasants but also led India to face shortage of food grains. Therefore, Indian agriculture remained backward and primitive.Deindustrialisation of Indian EconomyIndia failed to develop a sound and strong industrial base during the colonial rule. The status of industrial sector during the British rule can be well defined by the term ‘systematic deindustrialisation’. The cause of deindustrialisation can be attributed to the downfall of India’s handicraft industry and the cause of bleak growth of modern industry was the lack of investment. On one hand, the British government imposed heavy tariffs on the export of Indian handicraft products and on the other hand, allowed free exports of Indian raw materials to Britain and free imports of British products to India. As a result of the heavy tariffs, the Indian exports became costlier and its demand in the international market fell drastically that led to the collapse of Indian handicrafts industries. Simultaneously, the demand for the handicrafts products also fell in the domestic markets due to stiff competition from the machine made textiles of Britain. As a result, the domestic industries lacked investment and growth initiatives.Regression in Foreign TradeDuring the colonial rule, the British government owned the monopoly power over India’s foreign trade. The British government used the trade policy according to the interests of their home country. The exports and imports transactions were restricted only to India and Britain. On one hand, the exports from India provided the cheap raw materials to the British industries and on the other hand, India’s imports from Britain provided a virgin market for Britain’s products. In either ways, British industries were benefitted. Moreover, the surplus generated from t foreign trade was not invested in the Indian economy; instead it was used in administrative and war purposes by Britain to spread their colonial power.
  • Name some modern industries which were in operation in our country at the time of independence.

    • Class 11 commerce economics notes: The second half of the nineteenth century witnessed the emergence of modern industries. At the initial stage, development was confined to setting up of cotton and jute textile mills. The western parts of the country Maharashtra and Gujarat was the hub for cotton textile mills which were mainly dominated by the Indians whereas the jute industries were mainly concentrated in Bengal and were dominated by the British. In the beginning of the 20thcentury, Iron and steel industries also started emerging gradually. It was incorporated in 1907. Some other industries that were operating at a smaller scale during the British era were sugar industry, cement industry and paper industry.

class 11 commerce economics notes: Chapter 2 – Unit I- Indian Economy 1950-1990

  • miracle seeds

    • Class 11 commerce economics notes: High Yielding Variety of seeds was developed by the Nobel Laureate Dr. Narman Barlauf in Mexico. These seeds are more productive and need regular and adequate irrigation facilities along with greater use of fertilisers and pesticides. In 1966, consequent to the use of HYV seeds, Indian agricultural sector experienced Green Revolution, especially in the crops of rice and wheat. HYV seeds grow faster than the normal seeds and, consequently, crops can be harvested in a much shorter time period. Initially, HYV seeds were used in states like Punjab, Andhra Pradesh and Tamil Nadu (as these states had more suitable irrigation facilities) and later on to other states. Consequent to the use of HYV seeds, the production of food grains in 1967-68 increased by 25% (approx).
  • Explain the need and type of land reforms implemented in the agriculture sector.

    • Class 11 commerce economics notes: The need for land reforms in India was very necessary due to the following reasons:1. Land Tenure System: There were three types of land tenure systems namely, the Zamindari System, the Mahalwari System and the Ryotwari System prevalent in the Indian agricultural sector at the time of independence. The common feature of these three systems was that the land was mostly cultivated by the tenants and the land revenues were paid by them to their landlords. This led to the exploitation of tenants in the form of exorbitant rents.2. Size of Land Holdings: The size of land holdings owned by the farmers was very small. In addition, the land holdings were fragmented. This obstructed the use of modern techniques.3. Lack of Initiative: As most of the land was owned by the landlords, so the farmers lacked initiative and neither had enough means to undertake mechanised methods of cultivation.4. Traditional Approach and Low Productivity: Indian farmers used to rely on the conventional and the traditional inputs and methods and climatic conditions that hampered the productivity of agricultural sector.5. Absence of Marketing System: Due to the absence of well developed marketing system, the farmers used to rely on the intermediaries to sell their product in the market. These intermediaries used to purchase the farm products at a very low price and sell them at higher price at market. Consequently, the correct profit share did not accrue to the farmer and, hence, this led to the lack of finance and investment on farm.6. Nature of Farming: The basic motive for farming was for subsistence. That is, farming was done basically to earn survival and not for sale and to earn profit.Due to the above problems in the Indian agriculture, it was very necessary to undertake land reforms. Land reforms comprise of the following steps:-1. Abolishing Intermediaries: The prime focus of land reforms was to abolish intermediaries like Zamindars, Jagirdars, etc. There were many steps undertaken to make the tillers, the owners of the land.2. Regulation of Rent: The cultivators were exploited in the form of exorbitant rents. In the first five year plan, the maximum rent fixed was one-fourth or one-fifth of the total farm produce (except in Punjab and Haryana, where it was rd). The regulations of rent not only reduced the burden from the tenants but also enabled them with greater portion of finance to invest on farm.3. Consolidation of Holdings: As the land holdings were small and also fragmented, so it was very necessary to consolidate the land holdings for the use of modern and advanced technology. The farmers were given consolidated holdings equal to the total of the land in their various fragmented plots. This enabled them the benefits associated with the large scale production.4. Land Ceilings: It means legislated fixed amount of land that an individual may hold. The basic motive behind this step was to promote equality of ownership of land holdings. This eradicated the concentration of land holdings in few hands. Government used to confiscate the excess land over the fixed amount of land and distribute it among the landless farmers.

      5. Co-operative Farming: This step was taken to counter the problems due to sub-division of holdings. Small scale farming by an individual land holder is neither profitable nor productive, so, these steps encouraged different farmers to pool their farms and perform farming jointly. This enhanced the productivity and greater profits were shared by the individual farmers.

class 11 commerce economics notes: Chapter 3 – Unit II- Liberalisation, Privatisation and Globalisation

  • Why were reforms introduced in India?

    • Class 11 commerce economics notes: Economic reforms were introduced in the year 1991 in India to combat economic crisis. Economic Crisis of 1991 was a culminated outcome of the policy failure in the preceding years. It was in that year the Indian government was experiencing huge fiscal deficits, large balance of payment deficits, high inflation level and an acute fall in the foreign exchange reserves. Moreover, the gulf crisis of 1990-91 led to an acute rise in the prices of fuel which further pushed up the inflation level. Because of the combined effect of all these factors, economic reforms became inevitable and were the only way to move Indian economy out of this crisis.The following are the factors that necessitated the need for the economic reforms.1. Huge Fiscal Deficit: Throughout 1980s, fiscal deficit was getting worse due to huge non-development expenditures. As a result, gross fiscal deficit rose from 5.7% of GDP to 6.6% of GDP during 1980-81 to 1990-91. Subsequently, a major portion of this deficit was financed by borrowings (both from external and domestic source).The increased borrowings resulted in increased public debt and mounting interest payment obligations. The domestic borrowings by government increased from 35% to 49.8% of GDP during 1980-81 to 1990-91. Moreover, the interest payments obligations accounted for 39.1% of total fiscal deficit. Consequently, India lost its financial worthiness in the international market and, fell in a debt trap. Thus, economic reforms were needed urgently.2. Weak BOP Situation: BOP represents the excess of total amount of exports over total amount of imports. Due to lack of competitiveness of Indian products, India was not able to earn enough foreign exchange through exports to finance our imports. The current account deficit rose from 1.35% to 3.69% of GDP during 1980-81 to 1990-91. In order to finance this huge current account deficit, Indian government borrowed a huge amount from the international market. Consequently, the external debt increased from 12% to 23% of GDP during the same period. On the other hand, Indian exports were not potent enough to earn sufficient foreign exchange to repay these external debt obligations. This BOP crisis compelled the need for the economic reforms.3. High level of Inflation: The high fiscal deficits forced the central government to monetise the fiscal deficits by borrowings from RBI. RBI printed new money that pushed up the inflation level, thereby, making the domestic goods more expensive. The rate of inflation rose from 6.7% p.a. to 10.3% p.a. during 1980s to 1990-91. In order to lower the inflation rate, government in 1991 had to opt for the economic reforms.4. Sick PSUs: Public Sector Undertakings were assigned the prime role of industrialisation and removal of inequality of income and poverty. But the subsequent years witnessed the failure of PSUs to perform these roles efficiently and effectively. Instead of being a revenue generator for the central government, these became liability. The sick PSUs added an extra financial burden on the government’s budget.Thus, because of all the above reasons existing concomitantly, the economic reforms became inevitable.

class 11 commerce economics notes: Chapter 4 – Unit III- Poverty

  • Why is calorie-based norm not adequate to identify the poor?

    • The calorie-based norm is not adequate to identify the poor because of the following reasons:
    • This mechanism does not differentiate a very poor from other poor. It categorises them into one category that is, ‘poor’. Consequently, it indicates whole class of poor and not, especially, those poor who are the most needy.
    • This mechanism uses inappropriate proxies for income like Monthly Per Capita Expenditure (MPCE), etc. These items do not act as suitable and appropriate proxies for income to measure calorie requirements.
    • This mechanism does not consider various important factors that are associated with poverty. These factors are health care, clean drinking water, proper sanitation and basic education. Mere estimation of calorie intake does not reflect the true economic condition of an individual.
    • Another shortcoming of calorie-based norm is that it fails to account for social factors that exaggerate and worsen poverty like ill health, lack of access to resources, lack of civil and political freedom, etc.Therefore, because of these shortcomings in the calorie-based norm, it cannot be used to identify the poor.

class 11 commerce economics notes – complete details

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