THE STORY OF

VILLAGE PALAMPUR

ECONOMICS CHAPTER -1
What is Economics?
• Its a field of study in which we study about an
economic or capital-related problem.
• Economics is a social science concerned with the
production, distribution, and consumption of
goods and services.
Introduction to village Palampur (imp.)
• It’s an imaginary village and farming is the main activity.
• Its neighboring village is Raiganj and its nearest town is Shahpur.
• There is a well-developed road.
• There are 450 families in the village consist of a different caste.
• The 80 upper-caste families own the majority of the land.
• The houses of the rich are building with brick and cement.
• The SC’s are 1/3rd of the total population there houses are made with
mud and straw.
• Most of the houses have electric connections.
• Palampur has two primary schools and one high school.
• There is one primary health center own by the government.
The factor for production:-

➢ Land,
➢ Labor,
➢ Capital,
➢ Entrepreneur.

➢ Land
• It refers to all-natural resources which are the free gifts of nature like a forest,
mountain, and soil, etc. Income distributed it rent.
• Feature/characteristics of land:-

 It’s a free gift of nature.

 The land is fixed in quantity.
 The land is permanent.
 Land lack of mobility.
➢ Labor
• Any work(manual or mental) which is done for earning money
is called labor. The price paid to labor is called wages.
• Feature/characteristics of labor:-

 The land is inseparable from the labour.

 Labour has to sell his labour in person.
 Labour does not last its perishable.
 The labour has to accept the wages offered to him.
➢ Physical capital
• It refers to that part of man with wealth which is used in foot her
production or generating income. Plant and machinery tool factories
dams. Income distributed to its interest.
• Two type of capitals:-

 Fixed capital
 Working capital
 Fixed capital:- It’s useful for many productions for many years.
Plant machinery tools.
 Working capital:- Tis used in production only for one time e.g,
money.
➢ Entrepreneur
• It’s a person who undertakes risk and bear uncertainty to produce a commodity.
• It combines the factor of production of land, labor, and capital.
• Income earned by him is profits.

 Availability of land in Palampur is fixed

• Farming is the main activity in Palampur.

• 75% of people dependent on farming.
• Since 1960, there was no expansion in inland cultivated areas in the village.
• But after 1960 the wasteland is converted into cultivated land.
• So the land area increased for cultivation.
Is there a way one can grow more from the same land?
• Yes, one can grow more from the same land.
• Multiple cropping:- Producing two or more crops in an area
from the same land in Rainy season produce Kharif crop(rice,
jowar, and bajra) in the winter season produce rabi
crop(wheat).
• Adopting modern earning method:- We can grow more than
from the same land by using HYV seeds chemical fertilizer in
insecticide, pesticides, and tubewells, etc. And nothing is by
converting wasteland into cultivable land.
Define Green Revolution(by M. Swaminathan) (imp.)

• An increase in the production of food grain is known as the green revolution.

• The green revolution is noted in India in 1960.
• This limited revolution is limited to the same crops like wheat and rice.
• It’s noted in Punjab, Haryana, and the western part of the U.P.
• In this modern farming, a method is used for a cultivator.
• Using HYV seeds, chemical fertilizers, insecticides, etc. tractor, thresher, etc.
• Permanent method of irrigation tubewells.
• Source of irrigation:-

 Tubewells,
 Canals,
 Rainwater,
 Rivers,
 Dams.
Ques:- Will the land sustain? (imp.)
• It depends upon the use of land if we use modern farming method
cultivation then the land will degrade the soil.
• Excess use of chemical fertilizer causes the loss of soil fertility.
• Continous use of groundwater for tubewell irrigation has reduced the
water level below the ground.
• Excessive irrigation makes the soil more alkaline(salinity)
sustainability of land will maintain only if we use organic farming.
• Less use of chemical fertilizer and use cow dungs as manure.
• Irrigation of land by river water or by rainwater.
• Less use of insecticide and pesticides.
How the land is distributed between the farmer
of Palampur?
• 1/3rd of 450 families are landless.
• 150 families, us(dalits) have no land for cultivation.
• 240 families cultivate a small plot of land less than 2
hectares in size.
• There are 6 families of a medium and large farmers
who cultivate more than 2 hectares.
• Few farmers has land extending over 10 hectares or
more.
Who will provide the labour in rural areas?

Farming is the main activity in rural areas.

• Small Farmer:- It along with their families cultivate their
land. They provide the labour required for farming
themselves.
• Medium and large farmer:- They have farmer labour to
work on their field farmer labour come either from land
fewer families or families cultivating small land. They do
not have right over the land.
Describe the mode of payment to form
labor?

• They get wages in cash or in-kind(crops).

• Some times they get means(food) wages of farm
labor are different from village to village or region
to region.
• Describe the duration of employment?
• Farm labor employment on daily wages.
• They may be employed for the whole year.
Ques:- Why the wages for form labour in Palampur less
than minimum wages?
• Government fixed the minimum wages for farm labour in
Palampur is Rs.115(April 2011) per day but labour gets only Rs.80
per day.
• It’s due to heavy competition for work among form labour.
• Because of labour supply is more than the demand for labour so the
wages are less for farm labour.
Ques:- How do the medium and large farmers obtain capital for farming?
How is it different from the small farmer?
• Small farmer borrows money to arrange capital they borrow from the large farmer, moneylender,
trader and they charge a high rate of interest on the loan.
• The medium farmer has their own saving from farming. They arrange the capital themselves.
After production, they do not pay a loan. So their profit is maximized.

Ques:- What the small farmer and rich farmer do with the surplus from the
product?
• Some farmer has little surplus farm products because their production is small and they kept the
grain for their own family needs.
• Large and medium farmers more surplus farm products and they supply it to the market and get
the project.
What are non-farm activities in rural
activities make a shortlist.
• Diary
• Small scale manufacturing like production of
surgery(gur) small rice miles and honey bee
collection etc.
• People engage in shopkeeping or in the trade of
goods and services.
• Transport
• Private clinics
• Private school
THANK YOU