80 upper caste families own majority of land in Palampur. Which economic problem of rural areas is depicted here?
Answers
Answer:
The purpose of the story is to introduce
some basic concepts relating to production
and this we do through a story of a
hypothetical village called Palampur.*
Farming is the main activity in
Palampur, whereas several other
activities such as small scale
manufacturing, dairy, transport, etc. are
carried out on a limited scale. These
production activities need various types
of resources — natural resources, manmade items, human effort, money, etc. As
we read through the story of Palampur,
we will learn how various resources
combine to produce the desired goods and
services in the village.
Introduction
Palampur is well-connected with
neighbouring villages and towns. Raiganj,
a big village, is 3 kms from Palampur. An
all weather road connects the village to
Raiganj and further on to the nearest
small town of Shahpur. Many kinds of
transport are visible on this road starting
from bullock carts, tongas, bogeys (wooden
cart drawn by buffalos) loaded with jaggery
(gur) and other commodities to motor
vehicles like motorcycles, jeeps, tractors
and trucks.
This village has about 450 families
belonging to several different castes. The
80 upper caste families own the majority
of land in the village. Their houses, some
of them quite large, are made of brick with
cement plastering. The SCs (dalits)
comprise one third of the population and
live in one corner of the village and in
much smaller houses some of which are
of mud and straw. Most of the houses have
electric connections. Electricity powers all
the tubewells in the fields and is used in
various types of small business. Palampur
has two primary schools and one high
school. There is a primary health centre
run by the government and one private
dispensary where the sick are treated.
• The description above shows that
Palampur has fairly well-developed
system of roads, transport, electricity,
irrigation, schools and health centre.
Compare these facilities with those in
your nearby village.
The story of Palampur, an imaginary
village, will take us through the different
types of production activities in the
village. In villages across India, farming
is the main production activity. The other
production activities, referred to as nonfarm activities include small
manufacturing, transport, shop-keeping,
etc. We shall take a look at both these
types of activities, after learning a few
general things about production.
The Story of Village Palampur
1
Chapter
Picture 1.1 Scene of a village
* The narrative is partly based on a research study by Gilbert Etienne of a village in Bulandshahr district in Western
Uttar Pradesh.
2020-21
2 Economics
Organisation of Production
The aim of production is to produce the
goods and services that we want. There
are four requirements for production of
goods and services.
The first requirement is land, and
other natural resources such as water,
forests, minerals.
The second requirement is labour, i.e.
people who will do the work. Some
production activities require highly
educated workers to perform the
necessary tasks. Other activities require
workers who can do manual work. Each
worker is providing the labour necessary
for production.
The third requirement is physical
capital, i.e. the variety of inputs required
at every stage during production. What
are the items that come under physical
capital?
(a) Tools, machines, buildings: Tools and
machines range from very simple tools
such as a farmer’s plough to
sophisticated machines such as
generators, turbines, computers, etc.
Tools, machines, buildings can be used
in production over many years, and
are called fixed capital.
(b) Raw materials and money in hand:
Production requires a variety of raw
materials such as the yarn used by
the weaver and the clay used by the
potter. Also, some money is always
required during production to make
payments and buy other necessary
items. Raw materials and money in
hand are called working capital.
Unlike tools, machines and buildings,
these are used up in production.
There is a fourth requirement too. You
will need knowledge and enterprise to be
able to put together land, labour and
physical capital and produce an output
either to use yourself or to sell in the
market. This these days is called human
capital. We shall learn more about human
capital in the next chapter.
• In the picture, identify the land, labour
and fixed capital used in production.
Picture 1.2 A factory, with several labourers
and machines
Every production is organised by
combining land, labour, physical capital
and human capital, which are known as
factors of production. As we read
through the story of Palampur, we will
learn more about the first three factors
of production. For convenience, we will
refer to the physical capital as the capital
in this chapter.
Explanation:
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