Economics and Social Issues Overview for RBI Grade B Phase 2 Exam


It is simply Social Science of the factors influencing “well-being”.

Three types of Economic System:-

MARKET ECONOMY: 

Based on division of labour.


SOCIALIST ECONOMY:

In this Economy, Goods and Services are produced to use, not to gain profit.


MIXED ECONOMY: 

In this Economy, Private sectors and Government sectors, both take part.

NOTE: India has adopted Mixed Economy.

Economic Growth:

  • Increase in the capacity of a country to produce the output of goods and services within the country. 
  • Steady increase in the GDP is a good indicator of economic growth. 

Economic Development:

  • Overall development of Economy. 
  • It implies a sustained increase in real per capita income of a country over a period of time. 

Micro Economics:

  • Studies the behaviour of individual, households and firms in making decisions on the allocation of limited resources. 

Macro Economics:

  • Deals with the performance, structure, decision making of the whole economy. This includes national, regional and global economics. 

Economics activities can be classified as:-

Primary activities:

  • Directly dependent on natural resources. 
  • It includes agriculture, mining, fishing, forestry etc. 

Secondary activities:

  • Adding value to the natural resources by transforming raw materials into valuable products. 
  • It includes manufacturing, processing and construction industries. 

Tertiary activities:

  • It includes both production and exchange. 
  • Some of the tertiary activities are trade, transport, communication and services. 

Quaternary activities:

  • Production of information. 
  • It revolves around research and development. 

INDIAN ECONOMY

According to World Bank, Indian Economy will accelerate to 7.2% in 2017-18, 7.5% in 2018-19 and 7.7% in 2019-20.

GDP composition by sector (2016 Estimate):

  • Service sector= 45.4% 
  • Industry sector= 29.8% 
  • Agriculture sector= 16.5% 

NOTE: Sources, THE WORLD FACTBOOK.
  • Indian Economy is the 7th largest Economy by nominal GDP. 
  • 3rd largest by purchasing power parity (PPP). 
  • Maharashtra is the wealthiest Indian state. 
  • India ranks 2nd worldwide in farm output. 
  • Indian Economy will become 3rd largest economy by 2030, surpassing 4 developed nations JAPAN, GERMANY, BRITAIN and FRANCE, according to projections by a US government agency. 
  • Sector wise contribution in GDP: 

WORLD
INDIA
USA
CHINA
AGRICULTURE
6
17
1
9
INDUSTRY
30
26
19
43
SERVICES
64
57
80
48

NOTE: ALL NUMERICAL ARE IN %.

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