Savitribai Phule Pune University

(Formerly University of Pune)

Syllabus for [Link]./Ph.D. (PET) Entrance Exam : Economics

Research Methodology
Unit 1: Foundations of Research
Meaning of Research, motivation for research, objectives of research Characteristics of
scientific method, empiricism, value neutrality, Repeatability verifiability Approaches to
research: positivistic and interpretive, qualitative and quantitative, inductive and deductive

Unit 2: Basic terms and types of research

Theory, concept, construct, fact,
Independent and dependent variables,
Methodology, method, tool and technique
Types of research- Exploratory, descriptive, analytical/explanatory, experimental, evaluation
and impact assessment, interdisciplinary, multidisciplinary, trans-disciplinary,
Basic Research, Applied Research

Unit 3: Research Design

Research design- concept and definition, need, advantages of planning a research,
characteristics of good research design, Steps in research design; Identification, Selection
and Formulation of problem, Literature Review, Primary and secondary data, sources of
data- authenticity, credibility, reliability of sources and data

Unit 4: Hypothesis

Definition, characteristic of good hypothesis and sources of hypothesis

Types of hypothesis, Null hypothesis and Alternative Hypothesis
Hypothesis Testing– Type I and Type II errors

Unit 5: Sample and sampling designs

Concept of population, sample, sampling frame, sampling unit
Need and advantages of sample study, Methods of sampling, characteristics of
representative sample, sampling error, Concept of probability and non-probability sampling
Types of probability sampling- simple random sampling, systematic random sampling,
proportionate and disproportionate stratifies random sampling
Types of non-probability sampling- purposive, snowball

Unit 6: Methods of research

Sample Survey, Case-study, life-history, ethnography, historical, Interview
Unit 7: Tools of data collection
Questionnaire, Interview Schedule, Observation and types of observation, Focused Group
Discussion, Scales and scaling techniques, Interview Guide, Field Diary
Unit 8: Statistics in Social Sciences
Types of measurement: Nominal, Ordinal and Scale
Basic statistical techniques: aggregation of data, totals, percentages, tabulation – univariate,
cross tabulation- bivariate and multivariate
Data Presentation- Charts and Graphs: Bar charts, Histograms, Clustered bar charts,
clustered histogram, pie chart, Pyramid
Measures of Central Tendency: Averages – Arithmetic mean, Geometric mean, harmonic
mean, Median, Mode
Measures of Dispersion: Range, Standard Deviation, Variance, Coefficient of Variation
Association, Correlation
Unit 9: Research Ethics
Research Ethics, History of research ethics.
Introduction to ethical principles - What is morality?, What is ethics?, What is ethical
theory?, Anonymity, Confidentiality, Informed consent, Rights of participants, Harm to
respondents and Researchers, Principles of biomedical and social science ethics, Ethical
Guideline in Social Research

Subject Concerned Syllabus

Economics

Micro-Economic Analysis

Topic I : Introduction :

The Basic Micro- Economic Problem of Scarcity and Choice. Market and Price Mechanism,
Disturbances to equilibrium, floor price, ceiling price.

Topic II : Consumer Theory :

The concept of and Measurement of Utility: Cardinal and Ordinal. Theory of Consumer
Choice: Marginal Utility Theory, Indifference curve approach, Income and Price expansion
paths, Demand Curve. Income and Substitution Effects: Slutskey and Hicksian approach.
Theory of Revealed Preference, Index Numbers. Concept of Elasticity: Price, Income and
Cross Elasticities. Concept of Consumers’ Surplus.

Topic III : Production Theory :

Production Function – One input, two inputs: Isoquants. Law of Variable Proportions,
Returns to the Variable Factor, Returns to Scale, Cobb- Douglas Production Function.
Producer’s equilibrium with one and two inputs. Cost Curves, Total, Average and marginal
Cost Curves, Short Run and Long Run Costs, Economist concept of cost. Derivation of Supply
curve, Firm and Industry, Short Run and Long Run. Concept of Producers’ Surplus.
Topic IV : Equilibrium :

Short Run, Long Run Equilibrium of a Single Firm under Competitive conditions. Partial and
General Equilibrium. Edgeworth Box Depiction of Competitive market equilibrium involving
only exchange.

Topic V : Classification of Markets :

Classification of Markets. Various types of Markets.

Topic VI : Monopoly :

Measurement of Monopoly power. Equilibrium of a Firm under Monopoly. Price

Discrimination under Monopoly, different types. Comparison of monopoly and perfectly
competitive market outcomes. Regulation of Monopoly Power.

Topic VII : Imperfect Competition :

Monopolistic Competition, Price and Non-price competition, Equilibrium. Product

Differentiation, Selling Costs and Excess Capacity. Oligopoly, Basic market structure, Non-
collusive oligopoly, Cournot-Bertrand Solution. Collusive oligopoly, Cartels, Price and Output
Determination Game Theory, Basic Concepts, Dominant Strategy Equilibrium, Nash
Equilibrium, Repeated and Sequential Games.

Topic VIII : Alternative Theories of the Firm :

Goal of Profit Maximization and Alternative Theories of the Firm. Baumol’s Sales Revenue
Maximization Model.

Topic IX : Theory of Distribution and Welfare Economics

Marginal Productivity Theory. Product Exhaustion theorem. (Euler’s Theorem) Piguo’s

Welfare Theorem Pareto Optimality Social Welfare Function, Compensation Criteria.
Arrow’s Impossibility Theorem.

Suggested readings:
• Varian, Hal : Intermediate Microeconomics, W.W. Norton and Company, New York.
(Latest editions)
• Hirschleifer J and A. Glazer : Price Theory and Applications, Prentice Hall of India, New
Delhi. (Latest editions)
• Stigler, G : Theory of Price, Prentice Hall of India, New Delhi. (Latest editions)
• Sen, A.(1999): Micro Economics: Theory and Applications, Oxford University Press, New
Delhi.
• Misra S.K. and V.K. Puri : Advanced Microeconomic Theory, Himalay Publishing House,
New Delhi. (Latest editions)
• Kreps, David, M (1990): A Course in Microeconomic Theory, Princeton University Press.
(Latest editions)
 Macro Economics

Topic I : National Income :

Gross Domestic Product, Gross National Product, Net Domestic Product- Nominal and Real
domestic product Price Indexes and GDP deflator Concept of disposable Income and
Relationships between Income consumption, Saving, Investment, Government Expenditure,
Taxes, Imports and Exports National Accounts Statistics-system of national income
accounting in India.

Topic II : Aggregate Supply Aggregate Demand :

Difference between Potential Output and Actual Output- Classical Approach, Keynesian
approach, Determination of Equilibrium, of Aggregate Demand and Supply, Determination
of output and employment Effects of change in Aggregate Demand and Supply Curves -
Classical Approach, Keynesian approach-neutrality of money Multiplier Effect, Multiplier
effect with inclusion of Government sector. (Automatic stabilizers, balanced budget
multiplier)

Topic III : Brief structure of IS-LM Model :

Derivation of IS curve and LM curve, Equilibrium in the Goods and Assets under fixed and
flexible prices, Derivation of aggregate demand schedule. Monetary and Fiscal policy- The
transmission Mechanism-Liquidity Trap, Fiscal policy and crowding out Optimum Policy mix
with IS-LM model.

Topic IV : Consumption Saving, Investment Spending :

Consumption and saving, Life cycle hypothesis, Permanent income hypothesis. Investment
spending, Marginal productivity of capital, Concept of accelerator and super multiplier.

Topic V : New Keynesian and New classical Approaches:

The Real Business cycle Theory, The Rational expectations Revolution New Classical
Macroeconomics:
Perfect Information - Rational Expectations, Lucas critique- Imperfect information and
asymmetric information, Real business cycle theory

Topic VI : Open Economy Issues :

Open Economy IS-LM-BP, The Mundell-Fleming Model Stabilization, Macroeconomic policy

and exchange rate regimes

Topic VII : India’s Macro economy :

Overview. Changes in macro economic variables after 1991- Problems and policy
Topic VIII : Money and Liquidity:

Definitions of Money, Money ness and liquidity Measures of Money Supply Liquidity
measures according to Reddy Committee Report Nature, functions, types and evaluation of
money- The debate relating to the definition of money, Liquidity theory. Gurley and Shaw
Hypothesis- Alternative money stock measures. The quantity and components of money
stock in India and broad trend in them

Topic IX : Demand for Money:

Nominal v/s Real Cash Balance. Neo Classical theory, Keynes’s Theory, Friedman's Theory,
Empirical Evidence.

Topic X : Money and Prices:

The Quantity Theory of Money Fishers QTM, Cambridge Cash Balance Approach QTM and
Income Equation. QTM as the theory of Price level Baumol-Tobin theory Issues regarding
endogenous and exogenous supply of money.

Topic XI : Money Supply:

Goals Targets, Indicators and instruments of Monetary Policy- theory of Money Supply: high
Powered Money-Money Multiplier Process, Determinants of Money Multiplier- Factor
Affecting High Powered Money- Autonomy of High powered money- Reserve Bank’s analysis
of Money Supply, Balance sheet of Reserve Bank of India

Topic XII : Inflation:

Definition sources of Inflation- Demand Pull Inflation- cost push inflation- Income Shares
Inflation-Phillips Curve.

Topic XIII : Theories of Interest Rates:

Real and monetary theories of the interest rate, Loanable funds theory. Keynesian theory-
Wicksellian theory Fisher's theory, Hicksian theory, Interest rate differentials- Term-
structure of interest rates - Role of interest rates in Macro-economy, Credit market
imperfections

Topic XIV : Monetary Policy and Macroeconomy:

Monetary transmission mechanism and targeting Inflation Money growth and interest rates
Interest rate rules -Taylor rule
Rules versus discretion -Central Bank autonomy - Dynamic inconsistency of monetary policy
credibility and reputation.

Suggested Reading:
• Rudiger Dornbush and Stanley Fisher - Macroeconomics Mankiw-Macroeconomics
(latest ed.).
• Branson-Macroeconomic Analysis [Link]-Macroeconomics Theory and policy (latest
ed.).
• National Accounts Statistics-NAS Measures, Concepts of National Accounts
Statistics(latest ed.).
• Mishkin Frederic (2007), The Economics of Money Banking and Financial Markets, 8th
edition Addison Wesley Longman Publishers
• Bain, Keith & Howells, Peter (2009), Monetary Economics: Policy and Its Theoretical
Basis, Palgrave
• Wrightman D:- An Introduction to Monetary Theory and Policy (latest ed.).
• Gupta S. B. :- Monetary Economics Institutions, theory and policy (latest ed.).
• Gupta S B :- Monetary Planning for India (latest ed.).
• Harris:- Monetary Theory (latest ed.).

Public Economics

Topic I – Introduction :

Role of government in organized society, changing perspective – Government in a mixed

economy, public and private sector – government as an agent for economic planning and
development – Private goods, public goods and merit goods.

Topic II – Rationale for Public Policy :

Allocation of resource provision of public goods – Voluntary exchange models – Impossibility

of decentralized provision of public goods - contributions of Samuelson and Musgrave –
Demand revealing schemes for public goods, contributions of Clark, Groves and Leyard –
Tiebout model – Theory of club goods – Stabilization policy.

Topic III – Public Expenditure:

Wagner’s law of increasing state activities – Wiseman-Peacock hypothesis – Pure theory of

public expenditure – Structure and growth of public expenditure – Criteria for public
investment – Social cost-benefit analysis – Project evaluation – Estimation of costs –
Discount rate – Reforms in expenditure budgeting – Programme budgeting and zero base
budgeting.

Topic IV – Taxation :

Theory of incidence – Alternative concepts of incidence – Allocative and equity aspects of

individual taxes – Benefit and ability to pay approaches – Theory of optimal taxation –
Excess burden of taxes – Trade off between equity and efficiency.

Topic V – Public Debt :

Burden of public debt – Sources of public debt – Public borrowings and price level –
Crowding out of private investment and activity – Principles of debt management and
repayment.
Topic VI – Fiscal Policy :

Objectives of fiscal policy – Full employment – Anti-inflation – Economic growth –

Redistribution of income and wealth – Interdependence of fiscal and monetary policies –
budgetary deficits and its implications – Analysis of latest budget- Fiscal policy for
stabilization – Automatic vs. discretionary stabilization – Alternative measures of resource
mobilization and their impact on growth – Distribution and prices – Balanced budget
multiplier.

Topic VII – Fiscal Federalism:

Fiscal federalism in India – Vertical and horizontal imbalance – Assignment of function and
sources of revenue – Constitutional provisions – Finance commission and planning
commission – Devolution of resources and grants – Theory of grants – Resource transfer
from union to state – Criteria for transfer of resources – Center-state financial relations in
India – Problems if states’ resources and indebtedness – Transfer of resources from union
and state to local bodies.

Topic VIII – Indian Tax system:

Revenue of the Union – State and local bodies – Major taxes in India – Base of taxes – Direct
and indirect taxes – Taxation of agriculture – Expenditure tax – Reform in direct and indirect
taxes – Taxes on Services –Non-tax revenue of center, state and local bodies – Analysis of
central and state government budgets – Fiscal situation of the PRIs - Trends in public
expenditure and public debt

Topic IX - Issues in India’s Fiscal system:

Reports of Finance Commissions in India – Review of Latest Finance Commission--Fiscal

crisis and fiscal sector reforms in India’s – India’s response to Global economic shocks.

Suggested Readings:
• Ulbrich – Public Finance in Theory and Practice (latest ed.)
• Bagchi A. – Readings in Public Finance
• Various Government of India Budget Documents
• Various Government of India Economic Surveys
• Musgrave R. A. and Musgrave P. S. – The theory of Public Finance (latest ed.)
• Stiglitz Joseph – Economics of the Public Sector (different ed.)
• Herber – Modern Public Finance (latest ed.)

International Economics

Topic I – Overview of classical and modern trade theories :

Classical theories of trade – Ricardo and the concept of Comparative Cost theory -
opportunity cost –Heckscher Ohlin theorem, Verification of physical criterion and price
criterion, Leontief paradox – Factor price equalization and explanation with Edgeworth Box
diagram
Topic II – New trade theories:

New theories of trade, product life cycle and technology gap models, Preference similarity
and intra-industry trade, economies of scale and monopolistic competition - Krugman,
Theory of economic geography – Krugman, Neo-Heckscher Ohlin theorem

Topic III – Terms of Trade :

Concepts of Net Barter Terms of Trade, Gross Barter Terms of Trade, factors affecting Terms
of Trade

Topic IV – Trade Policy :

Free trade vs. controlled trade, Tariffs and non-tariff barriers on trade, Effects of tariffs
under partial equilibrium. (Price effect, terms of trade effect, competitive effect, income
effect, revenue effect) Effects under general equilibrium, Stolper – Samuelson theorem

Topic V – Regional Integration :

Customs Unions: Features of customs union theory. Trade creation and trade diversion
under customs union (with graphical treatment), the creation of European Union

Topic VI – GATT and WTO :

International trade agreements. Dunkel proposal. WTO, Important Agreements under WTO,
major developments since 1995, Expected effects on the Indian economy.

Topic - VII – Balance of payments :

Balance of payments. Current account and capital account transactions. Disequilibrium in

BOP, adjustment mechanisms. Marshall-Lerner elasticity approach, absorption approach,
monetary approach, Internal and External Balance. Swan model.
Topic - VIII Exchange rates :

Exchange rates. Flexible and fixed exchange rates. Determination of exchange rates.
Revaluation and Devaluation, Appreciation and Depreciation, Risks and rewards involved.
Spot rates and forward contracts, options and futures. International financial markets. Euro
currency markets, International Bond Markets

Topic – IX Exchange control :

Convertibility on current account and capital account, Exchange control: objectives of

exchange control. Methods of exchange control, Indian Rupee and its fluctuations in the
international currency markets.

Topic – X :

Optimum currency area theories - Factor mobility theory, propensity to inflation theory -
the process of development of Euro as an optimum currency area
Topic – XI :

International financial movements. Portfolio and direct investments and their impact on the
economy. Multinational and transnational corporations and their role in the international
financial movements.

Topic – XII :

Rise and fall of Bretton Wood and the emerging International Monetary system, IMF,
mechanism of membership quota and borrowing, Conditionalities. Evaluating the
contribution of IMF, Important International Financial Crisis and the role of IMF (Oil crisis,
International debt crisis, South East Asian crisis, Brazil Argentina and Mexico, Russia and
Eastern Europe, The sub-prime crisis)

Suggested readings:
• Paul R. Krugman & Maurice Obstfeld (2009) International Economics Theory and Policy.
Pearson Education Publication, New Delhi.
• Chacholiades, M., International Trade : Theory and Policy, McGraw Hill, Kogakusha,
Japan.(latest ed.)
• Kindleberger, C.P. International Economics, R.D. Irwin, Homewood.(latest ed.)
• Salvatore, D., International Economics, Prentice Hall, Upper Saddle River, N.J., New York.
(latest ed.)
• Soderston, Bo (2005), International Economics, The Macmillan Press Ltd., London.
• James Ingram: International Economics (Ed. 1995)
• Krugman International Economics (latest ed.)
• Kennen International Economics (latest ed.)
• Maurice Levi: International Finance (latest ed.)

Growth and Development

Topic I : Development and Underdevelopment: An Overview

The relevance of economic development - Problems in defining economic development -

Characteristics of LDCs - structural view of underdevelopment - The world distribution of
income - Development gap - Per capita income as an index of development - Difficulties of
measurement and comparability problems involved in the calculation of per capita
according to exchange rate and purchasing power parity- Alternative measures of
development gap - Cross country comparisons - HDI

Topic II : Poverty and inequality

Poverty and income distribution - defining poverty and problems of measurement - Income
inequality - measurements of inequality - understanding inequality in the developed and
underdeveloped worlds - impact of inequality on the process of development.
Topic III : Theories of Economic Growth and Development:

The Harrod Domar growth model and it's application to LDCs - Solow’s model of economic
growth - The production function approach to the study of causes of growth - The Cobb-
Douglas Production function - Embodied and disembodied technical progress
Economic growth in historical perspective : Marx, Schumpeter, Gerschenkron, - Surplus
labour (Lewis) - big push (Rosenstein-Rodan) - Balanced growth (Nurkse) - Unbalanced
growth (Hirshman) - The process of cumulative causation (Myrdal) — the center and
periphery hypothesis - the dependency school - New Endogenous growth models-
Intellectual capital: role of learning, education and research; AK model — Explanations of
cross country differentials in economic growth

Topic IV : Population growth and economic development

Population - basic concepts - the theory of demographic transition - age structures of

population - Migration - Rural and Urban migrations -The Harris - Todaro Model - problems
of urbanization - Employment markets - Formal and informal employments - wage rates

Topic V : The role of agriculture in development

Role of Agriculture in development - The supply response of Agriculture - The concept of

‘Marketed surplus’ - Size holdings and output - Limitations of price policy and alternatives -
The growth of the money economy - Disguised unemployment

Topic VI : Role of Industry in development

Role of industry - Major reasons for industrialization in LDCs - The infant industry argument -
The employment argument - Export promotion vs import substitution - Strategies - The
choice of techniques and problems in LDCs - Techniques of production in practice - The
Technological choice - Appropriate and inappropriate technology - Capital-Intensive
technology and employment in industry. The Role of Infrastructure - social and physical
infrastructure - education and health infrastructure

Topic VII : Mobilization of resources

Domestic Resources : The Prior-savings approach - Monetary Policy - Fiscal Policy - Inflation,
savings and growth - Non -inflationary finance of investment - Inflation and credit - Inflation
and growth

Topic VIII : Trade and development

Trade as an engine of growth - Dual gap analysis - Prebisch, Singer and Myrdal views - gains
from trade and LDCs - foreign borrowing - Savings - Investment gap - The foreign exchange
gap - Models of capital imports and growth - Capital imports, domestic savings the ICOR -
foreign borrowing and debt - servicing problem - types and measurement of international
capital flows - the role of IMF and World Bank - Case studies of countries with trade as a
growth engine
Topic IX : The role of the government

The role of the government and markets in the developmental process - Development of
distributive institutions - poverty alleviation measures - public distribution systems - public
policies like NREGA in India - Microfinance - issues related to microfinance. Self Help Groups
and savings and Gender

Suggested reading:
• Meier G.M- Leading Issues in Development Economics (latest ed.)
• Thirval A P - Development Economics (latest ed.)
• Ray Debraj- Development Economics (latest ed.)

Statistics

Topic 1 : Introduction to statistics

Overview of Basic statistical concepts, central tendency and dispersion, Skewness and
Kurtosis

Topic 2 : Correlation and regression

Correlation coefficient, Standard error and regression equations, one variable regression
analysis

Topic 3 : Fundamentals of Probability

Random Variable, and Mathematical Expectation, Theoretical Distributions (Binomial,

Normal, and Poisson)

Topic 4: Sampling Techniques

Fundamentals of Sampling, Estimation, Statistical Inference, Chi-Square Test,

F-Distribution, ANOVA, Association of Attributes, Non-Parametric Tests

Topic 5: Index Numbers and Time Series

Introduction to index numbers, construction of indices, different forms of indices

Introduction to time series

Suggested readings:
• Arora, P.N.; Arora, Sumeet; Arora, Comprehensive Statistical Methods (latest ed.).
• S. P. Gupta :Statistical Methods (latest ed.).
• S. C. Gupta : Statistical Methods (latest ed.).