Regional disparity in industrial development in Haryana

The issue of economic disparity in the process of economic growth and development has bothered economists for a long time. Since the time of Adam Smith to the debate on convergence, divergence and globalization, economic inequality has always remained an integral part of economic discourse. The foundation of the traditional economies of efficient utilization of resources was laid down on the assumption of perfect mobility of factors between regions so it neglected the factors affecting like distance, geographical differences, demographic characteristics and locational preferences. As a result, in many developing countries due to neglect of these factors in forming national economic policies, discontent has reached an alarming proportion and it has become a political partitive issue now. The empirical evidences demonstrate that in a growing economy, regional disparities diverge at initial stages of develop-ment and subsequently they converge later when the economies reach the stage of maturity (Williamson, 1965; Myrdal, 1957; Alonso, 1968 and Rostow, 1960). It has been argued that if not corrected, the percent level of inequality could reduce the pace and durability of economic growth by undermining the progress in health and education and thereby increasing political and social instability (Ostry et al. 2014). In India, different states are growing at different rates due to difference in natural endowments, their geo-political, socio-economic and religious importance in the country and there seems to be no evidence in favor of convergence in future. In other words, the tendency of disparity amongst the states in the country seems to be increasing with time (Kurian, 2005).