Economics Optional Syllabus (Paper 1 + Paper 2) for UPSC Mains

Economics Optional Syllabus (Paper 1 + Paper 2) for UPSC Mains

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Among the 48 optional subjects available for students to choose from for the UPSC IAS exam, economics is one of the most popular choices. The primary reason why students choose this paper is because many topics from its syllabus overlap with the IAS Prelims GS Paper 1 and the IAS Mains GS Paper 3. The economics optional subject includes a wide range of topics. Having a thorough understanding of each topic is necessary if students want to secure good scores in the examination. Of course, this learning should go beyond theoretical knowledge and cover practical knowledge as well.

However, due to a lack of correct information about the Economics Optional Syllabus for UPSC Mains, many aspirants are unable to achieve their dreams. To solve this problem, we have listed all the different topics included in the first and second papers on this optional subject below. So, read on!

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Economics Optional Paper 1 Syllabus

Listed below are the different important topics included in the syllabus of paper 1 of economics optional for the UPSC entrance examination:

A. Advanced Micro Economics

  1. Alternative Distribution Theories: Ricardo, Kaldor, Kalecki
  2. Market Structure: Monopolistic Competition, Duopoly, Oligopoly
  3. Marshallian and Walrasian Approaches to Price Determination
  4. Modern Welfare Criteria: Pareto Hicks and Scitovsky, Arrow’s Impossibility Theorem, A. K. Sen’s Social Welfare Function

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B. Advance Macro Economics

  1. Approaches to Employment Income and Interest Rate determination: Classical, Keynes (IS-LM) curve, Neo-classical Synthesis and New Classical, Theories of Interest Rate determination and Interest Rate Structure

C. Money – Banking and Finance

  1. Demand for and Supply of Money: Money Multiplier Quantity Theory of Money (Fisher, Pigou, and Friedman) and Keynes’ Theory on Demand for Money, Goals and Instruments of Monetary Management in Closed and Open Economies. Relation Between the Central Bank and the Treasury. Proposal for Ceiling on the Growth Rate of Money.
  2. Public Finance and its Role in Market Economy: in the Stabilization of Supply, Allocation of Resources and in Distribution and Development. Sources of Government Revenue, Forms of Taxes and Subsidies, their Incidence and Effects. Limits to Taxation, Loans, Crowding-Out Effects, and Limits to Borrowings. Public Expenditure and its Effects.

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D. International Economics

  1. Old and New Theories of International Trade
  2. Comparative Advantage
  3. Terms of Trade and Offer Curve
  4. Product Cycle and Strategic Trade Theories
  5. Trade as an Engine of Growth and Theories of Underdevelopment in an Open Economy.
  1. Forms of Protection: Tariff and Quota
  1. Balance of Payments Adjustments: Alternative Approaches
  2. Price Versus Income, Income Adjustments Under Fixed Exchange Rates
  3. Theories of Policy Mix
  4. Exchange Rate Adjustments Under Capital Mobility
  5. Floating Rates and their Implications for Developing Countries: Currency Boards
  6. Trade Policy and Developing Countries
  7. BOP, Adjustments and Policy Coordination in Open Economy Macro-Model
  8. Speculative Attacks
  9. Trade Blocks and Monetary Unions
  10. WTO: Trims, TRIPS, Domestic Measures, Different Rounds of WTO Talks

E. Growth and Development

  1. Growth
  2. Theories of Growth: Harrod’s Model
  3. Lewis Model of Development with Surplus Labour
  4. Balanced Unbalanced Growth
  5. human Capitals and Economic Growth
  6. Research and Development and Economic Growth
  1. Process of Economic Development of Less Developed Countries: Myrdal and Kuznets on Economic Development and Structural Change: Role of Agriculture in Economic Development of Less Developed Countries
  2. Economic Development and International Trade and Investment, Role of Multinationals
  3. Planning and Economic Development: Changing Role of Markets and Planning, Private-Public Partnership
  4. Welfare Indicators and Measures of Growth – Human Development Indices. The Basic Needs Approach
  5. Development and Environmental Sustainability – Renewable and Non-Renewable Resources, Environmental Degradation, Intergenerational Equity Development

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Economics Optional Paper 2 Syllabus

The economics optional paper 2 of UPSC includes the following topics:

A. Indian Economy in the Pre-Independence Era

Land System and its changes, Commercialization of agriculture Drain theory, Laissez faire theory and critique. Manufacture and Transport: Jute, Cotton, Railways, Money and Credit

B. Indian Economy After Independence

The Pre-Liberalization Era

  1. Contribution of Vakil, Gadgil, and V.K.R.V. Rao
  2. Agriculture: Land Reforms and Land Tenure System, Green Revolution and Capital Formation in Agriculture
  3. Industry Trends in Composition and Growth, Role of the Public and Private Sector, Small scale and cottage industries
  4. National and Per Capita Income: Patterns, Trends, Aggregate and Sectoral Composition and Changes Therein
  5. Broad Factors Determining National Income and Distribution, Measures of Poverty, Trends in Poverty and Inequality

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The Post-Liberalization Era

  1. New Economic Reform and Agriculture: Agriculture and WTO, Food Processing, Subsidies, Agricultural Prices and Public Distribution System, Impact of Public Expenditure on Agricultural Growth
  2. New Economic Policy and Industry: Strategy of Industrialization, Privatization, Disinvestments, Role of Foreign Direct Investment and Multinationals
  3. New Economic Policy and Trade: Intellectual Property Rights: Implications of TRIPS, TRIMS, GATS and New EXIM Policy
  4. New Exchange Rate Regime: Partial and Full Convertibility, Capital Account Convertibility
  5. New Economic Policy and Public Finance: Fiscal Responsibility Act, Twelfth Finance Commission and Fiscal Federalism and Fiscal Consolidation
  6. New Economic Policy and Monetary System. Role of RBI Under the New Regime
  7. Planning: From Central Planning to Indicative Planning, Relation Between Planning and Markets for Growth and Decentralized Planning: 73rd and 74th Constitutional Amendments
  8. New Economic Policy and Employment: Employment and Poverty, Rural Wages, Employment Generation, Poverty Alleviation Schemes, New Rural, Employment Guarantee Scheme

Conclusion

Those were the necessary topics from the economics optional subject syllabus for the UPSC exam. With the right guidance, motivation, and effective study techniques, students can ensure that they get the best marks in the subject!

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  • Amit Kumar

    Passionate reader, Army Background, Critic, and Effulgent Speaker are his attributes. Amit Kumar Patra writes Educational Blogs. He has been a writer for 2 years. He always wanted to pursue writing as a career. His Blogs focus on Preserving the blend of professionalism and layman’s comprehension ability.

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