This paper examines long-run growth performance and regional divergence in per capita income across 15 major Indian states during the pre- and post-reform periods. Evidence shows that the divergence has increased the post-reform period. The divergence has been due to inter-state variations in production structures, human capital and infrastructure. Larger public investment in human capital and infrastructure for states with lower steady-state could improve overall growth performance and reduce regional imbalances. Ongoing economic reforms that seem to have led to an increase in growth as well as regional disparities of income need to be modified appropriately.

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Using the maximum likelihood method of cointegration, this paper empirically evaluates intra-state and inter-state spatial integration of wheat markets in India. The cointegration tests provide strong evidence in favour of spatial integration of the regional wheat markets. Even though the regional markets are geographically dispersed, the prices across different market centres within and across the selected states have exhibited long-run spatial linkages, suggesting that all the exchange locations are integrated and the prices provide relevant market signals. There are several implications of these results for agricultural price policy and food market liberalization programmes.

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This article evaluates rural infrastructure facilities in 16 major states of India, and examines their impacts on some income and non-income dimensions of rural development. Despite several public initiatives for infrastructure development in rural India, facilities continue to be poor and progress has been mostly unsatisfactory with differential performance across states. Estimates of regression coefficients of the composite indices and individual indicators of rural infrastructure reveal that improved physical and social infrastructure and livelihood opportunities enhance agricultural productivity and output, improve literacy and life expectancy, and reduce poverty and infant mortality. The results, showing the relative importance of various infrastructures, suggest that the government should prioritise additional investments in electricity, roads, irrigation, housing and telecommunications to enhance overall well-being. JEL Classification: H54, O15, O18, Q19