Jargons of Economics-II

Jargons are subject specific words in all the subjects. So is the case with Indian Economy because it helps the students in understanding the meaning of articles/publications/reports etc. (if any student is unable to understand these economics word).

Jargons are subject specific words in all the subjects. So is the case with Indian Economy because it helps the students in understanding the meaning of articles/publications/reports etc.  If any student is unable to understand these economics word, he/she will not be able understand the meaning of the article/ paragraph/report. We picked some of the most important words to enhance your knowledge of Indian Economy.

Gross Domestic Product: The total value of final goods and services produced within a country’s borders in a year, regardless of ownership. It is used as one of many indicators of the standard of living in a country, but there are limitations with this view.

Household: A group of persons normally living together and taking food from a common kitchen. The word ‘normally’ means that temporary visitors are excluded and those who temporarily staying away is included.

Import Licensing: Permission required from the government to import goods into a country.

Import Substitution: A policy of the state for development of economy in which import of goods is generally substituted by domestic production (through import controls, tariffs and other restrictions) with a view to encourage domestic industry on grounds of self-sufficiency and domestic employment.

Infant Mortality Rate: It is the number of deaths of infants before reaching the age of one, in a particular year, per 1,000 live births during that year.

Inflation: A sustained rise in the general price level.

Informal Sector Enterprises: Those private sector enterprises, which employ less than 10 workers on a regular basis.

Integration of Domestic Economy: A situation where the policies of government facilitate free trade and investment with other countries making the domestic economy work together with other economies in an efficient and mutually interdependent way.

Invisibles: Various items enter in the current account of the balance of payments, some of which are not visible goods. Invisibles are mainly services, like tourism, transport by shipping or by airways, and financial services such as insurance and banking. They also include gifts sent abroad or received from abroad and private transfer of funds, government grants and interests, profits and dividends.

Labour Laws: All the rules and regulations framed by the government to protect the interests of the workers.

Land/Revenue Settlement: With the British acquiring territorial rights in different parts of India, administration of territories was formulated on the basis of survey of land. It was decided in the interests of government in terms of revenues to be collected from each parcel of land in possession of either a Ryot (means peasant) or a Mahal (revenue village) or a Zamindar (a proprietary land holder). Decision in each of these cases was meant for the rights of the latter over land for the purposes of either ownership of land or rights to cultivation. This system is known as land/revenue settlement. There were different land settlements formulated in India. They are (i) system of permanent settlement, which is also known as the Zamindari system (ii) Ryotwari system (a system of revenue settlement entered into by the government with individual tenants) (iii) Mahalwari system (a system of revenue settlement entered into by the government with a Mahal).

Life Expectancy at Birth (years): The number of years a newborn infant would live if prevailing patterns of age-specific mortality rates at the time of birth were to stay the same throughout the child’s life.

Maternal Mortality Rate: It is the relationship between the number of maternal deaths due to childbearing by the number of live births or by the sum of live births and foetal deaths in a given year.

Merchant Bankers: Banks or financial institutions, also known as investment bankers, those specialize in advising the companies and managing their equity and debt requirement (often referred to as portfolio management) through floatation and sale/purchase of stocks and bonds. Morbidity: It is the propensity to fall ill. It affects a person’s work by making him or her temporarily disabled. Prolonged morbidity may lead to mortality. In our country, acute respiratory infections and Diarrhoea are two major causes of morbidity.

Mortality Rate: The word ‘mortality’ comes from ‘mortal’ which originates from the Latin word Mors (meaning death). It is the annual number of deaths (from a disease or in general) per 1,000 people. It is distinct from morbidity rate, which refers to the number of people who have a disease compared to the total number of people in a population.

MRTP Act: An Act (Monopolies Restrictive Trade Practices Act) framed to prevent monopolistic practices and regulate the conductor business practices of firms that are not in public interest.

Multilateral Trade Agreements: Trade agreements made by a country with more than two nations to exchange goods and services.

National Product/Income: Total value of goods and services produced in a country plus income from abroad.

Nationalisation: Transfer of ownership from private sector to public sector. This involves takeover of companies owned by individuals or group of individuals by either state or central government. In some contexts, it also involves transfer of ownership from state government to central government.

New Economic Policy: A term used to describe the policies adopted in India since 1991.

Non-renewable Resources: Resources that cannot be renewed. They have a finite, even if large, stock. Some examples are fossils fuels such as oil and coal and mineral resources—iron, lead, aluminium, uranium.

Non-tariff Barriers: All the restrictions on imports by a government in the form other than taxes. They mainly include restrictions on quantity and quality of goods imported.

Opportunity Cost: It is defined with respect to a particular value or action and is equal to the value of the foregone alternative choice or action. Pension: A monthly payment to a worker who has retired from work. Per Capita Income: Total national income of a country divided by its population in a specific period.

Permit License Raj: A term used to denote the rules and regulations framed by the government to start, run and operate an enterprise for production of goods and services in India.

Poverty Line: The per capita expenditure on certain minimum needs of a person including food intake of a daily average of 2,400 calories in rural areas and 2,100 calories in urban areas.

Private Sector Establishments: All those establishments, which are owned and operated by individuals or group of individuals. Productivity: Output per unit of input employed. Increase in the efficiency on the part of capital or labour leads to increase in productivity. This term is generally used to refer to productivity increase in labour inputs.

Provident Fund: A savings fund in which both employer and employee contribute regularly in the interest of the employee. It is maintained by the government and given to the employee when he or she resigns or retires from work.

Public Sector Establishments: All those establishments which are owned and operated by the government. They may be run either by local government, state government or by central government independently or jointly.

Quantitative Restrictions: Restrictions in the form of total quantities or quotas imposed on imports to reduce balance of payments (BOP) deficit and protect domestic industry.

Regular Salaried/Wage Employee: Persons, who work in others’ farm or non-farm enterprises and, in return, receive salary or wages on a regular basis (i.e. not on the basis of daily or periodic renewal of work contract). They include not only persons getting time wage but also persons receiving piece wage or salary and paid apprentices, both full time and part-time.

Renewable Resources: Resources that can be renewed through natural processes if they are used wisely. Forests, animals and fishes, if not overexploited, get easily renewed. Water is also in that category.

South Asian Association for Regional Cooperation (SAARC): It is an association of eight countries of South Asia — Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka and Afghanistan. SAARC provides a platform for the peoples of South Asia to work together in a spirit of friendship, trust and understanding. It aims to accelerate the process of economic and social development in member countries.

Self-Employed: Those who operate their own farm or non-farm enterprises or are engaged independently in a profession or trade with one or a few partners. They have freedom to decide how, where and when to produce and sell or carry out their operation. Their earning is determined wholly or mainly by sales or profits from their enterprises.

Social Security: A government or privately established system of measures, which ensures material security for the elderly, disabled, destitute, widows and children. It includes pension, gratuity, provident fund, maternal benefits, health care etc.

Special Economic Zone (SEZ): It is a geographical region that has economic laws different from a country’s typical economic laws. Usually the goal is to increase foreign investment. Special Economic Zones have been established in several countries, including the People’s Republic of China, India, Jordan, Poland, Kazakhstan, the Philippines and Russia.

Stabilisation Measures: Fiscal and monetary measures adopted to control fluctuations in the balance of payments and high rate of inflation.

State Electricity Boards (SEBs): These are part of the state administration that generate, transmit and distribute electricity in different states.         

Statutory Liquidity Ratio (SLR): A minimum proportion of the total deposits and reserves to be maintained by the banks in liquid form as per the regulations of the central bank (RBI). Maintenance of SLR, in addition to the Cash Reserve Ratio (CRR), is an obligation of the banks.

Stock Exchange: A market in which the securities of governments and public companies are traded. It provides the facilities for stock brokers to trade company stocks and other securities.

Stock Market: An institution where stocks and shares are traded.

Structural Reform Policies: Long-term measures like liberalisation deregulation and privatisation aimed to improve the efficiency and competitiveness of the economy.

Tariff: A tax on imports, which can be levied either on physical units, e.g. per tonne (specific) or on value. Tariffs may be imposed for a variety of reasons including: to raise government revenue, to protect domestic industry from subsidised or low-wage imports, to boost domestic employment, or to ease a deficit on the balance of payments. Apart from the revenue that they raise tariffs achieve little good—they reduce the volume of trade and increase the price of the imported commodity to consumers.

Tariff Barriers:  All the restrictions on imports by a government in the form of taxes.

Trade Union: An organisation of workers formed for the purpose of addressing its members’ interests in respect of wages, benefits, and working conditions.

Unemployment: A situation in which all those who, owing to lack of work, are not working but either seek work through employment exchanges, intermediaries, friends or relatives or by making applications to prospective employers or express their willingness or availability for work under the prevailing condition of work and remunerations.

Urbanisation: Expansion of a metropolitan area, namely the proportion of total population or area in urban localities or areas (cities and towns), or the increase of this proportion over time. It can thus represent a level of urban population relative to total population of the area, or the rate at which the urban proportion is increasing. Both can be expressed in percentage terms, the rate of change expressed as a percentage per year, decade or period between censuses.

Worker-Population Ratio: Total number of workers divided by the population. It is expressed in percentage.

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