Article on National Income National Income : Definition National Income Committee defines national income as the value of commodities and services produced in an economy during a given period, counted without duplication. Estimates of National Income: PreIndependence Estimates of National Income: Since there was no official body in India to prepare National Income estimate before Indian Independence, the same was prepared by some eminent personalities in their personal capacity. Dadabhai Naoroji, fondly called the Grand Old Man of India, was the pioneer in this field. He prepared the first estimates of National income in 1876. He estimated the national income by first estimating the value of agricultural production and then adding a certain percentage as nonagricultural production. However, such method can only been called as a nonscientific method. The first person to adopt a scientific procedure in estimating the national income was Dr. VKRV Rao in 1931. He divided the Indian Economy into two parts. 1. Agricultural Sector which included agriculture, forests, fishing and hunting. 2. Corporate Sector which included industries, construction, business, transport and public services. Two different methods were used for estimating the income in the two sectors. Product method was used for estimating income in agricultural sector and income method was used for estimating income in the corporate sector. Finally, Net Factor Income earned from abroad was added to the sum of the above two to obtain national income.
Posted on: Mon, 19 Jan 2015 06:30:07 +0000
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