Context: Jasmine Shah’s book, The Delhi Model highlights Delhi’s trickle-up economics, contrasting it with India’s traditional trickle-down approach.
About Trickle-Down vs. Trickle-Up Approach:
- Trickle-Down Economics:
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- Focuses on wealth accumulation at the top, assuming benefits will gradually reach lower income groups.
- Prioritizes corporate tax cuts, subsidies for big businesses, and deregulation.
E.g. India’s corporate tax cuts (2019) reduced revenue for social programs.
- Trickle-Up Economics:
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- Directly invests in lower and middle-income groups to boost demand and economic growth.
- Prioritizes public welfare, education, healthcare, and employment programs.
E.g. Delhi’s economic model reduced unemployment (1.9%) and public debt-to-GSDP ratio (3.9%).
Relevance in UPSC Exam Syllabus:
- GS Paper 1 (Society & Development): Impact of economic inequality on social structures.
- GS Paper 2 (Governance & Welfare Policies): Welfare schemes and their effectiveness in poverty alleviation.
- GS Paper 3 (Indian Economy & Growth Models): Economic development strategies and policy analysis.
- Essay Paper: Critical evaluation of economic models and inclusive growth
