ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Rural Non-Farm Activity-A Regional Model and Its Empirical Application

A Regional Model and Its Empirical Application to Maharashtra Vibhooti Shukla The performance and potential of rural non-agricultural activity in India have been the subject of much recent discussion. This paper attempts to formulate a model of this Sector that takes into account its functional linkages with agriculture and urban activity through an explicit recognition of their spatial dimension in a more comprehensive way than permitted by purely sectoral or micro approaches to the problem. The outlines of a unifying regional labour demand-and-supply framework capable of exploring alternative hypotheses and of addressing relevant policy issues in an empirically organised fashion is delineated. The model is implemented through multiple regression analysis of the determinants of levels of and changes in overall rural non-farm activity and its industrially disaggregated components across the districts of Maharashtra. Apart from a general validation of the explanatory power of the model and a quantitative documentation of the role of hypothesised influences in a manner usually consistent with theoretical expectations, these exercises reveal an interesting structural heterogeneity between various non-farm subsectors in their labour force composition and regional correlates.

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