April 2021
Ajay Chhibber (George Washington University)
Abstract: India entered its so-called demographic dividend around 2005 – expected to last until 2055. India has already utilized almost a third of the period of its demographic dividend– it saw a period of explosive growth from 2003-2012 – but has not been able to sustain that growth. And since 2012 growth has generated less and less employment, as it has turned inward, so it is not helping the working age population get usefully employed. The Labor force participation rate for women has been low and is now falling. To understand where India stands in this transformation we ask – why is India’s so dualistic? Why is so much of Indian labor not employed in the organized sector? Why does India with limited capital – and vast quantities of surplus labor invest so much in relatively capital intensive sectors? Why is land which is scarce so badly allocated ? why do most of its cities develop in an unplanned manner ? What can be done to use India’s underlying factors of production better to generate greater, more inclusive and sustained prosperity for its citizens?
JEL Codes: J0, J1, J2, J5, J6, J8, R0, R4, O1, O2
Key Words: Demographic Dividend, Labor Laws, Urban Development, Infrastructure, Logistics, Land Mis-allocation
