Page 351 - DECO502_INDIAN_ECONOMIC_POLICY_ENGLISH

Unit 27: Governance of the Economy—Implementation of Economic Policies

27.4 Key-Words Notes

1. Policy implementation : Represents the stage where government executes an adopted policy
as specified by the legislation or policy action. At this stage, various
government agnecies and departments, responsible for the respective
area of policy, are formally made responsible for implementation.
Policy implementation is what happens after a bill becomes law.
2. Parallel economy : Parallel economy connotes the functioning of an unsanctioned sector
in the economy whose objectives run parallel, rather in contradiction
with the aroused social objectives. This is variously termed as 'black
economy', 'unaccounted economy', 'illegal economy', 'subterranean
economy', 'unsanctioned economy' or 'hidden economy'. The National
Institute of Public Finance and Policy (NIPFP) defines black money
as the aggregate of incomes which are taxable but not reported to the
tax authorities.
A hidden economy in its broadest sense may consist of - a) illegal
economy, such as money laundering, smuggling, etc; b) unreported
economy including tax evasion; c) unregulated economy, ie economic
activities outside regulations.
27.5 Review Questions

1. What is the concept of Parallel economy? Discuss.
2. Discuss the factors responsible for policy failures.
3. What do you mean by the governance of policy economic policy?
Answers: Self-Assessment
1. (i)(c) (ii)(c) (iii)(d) (iv)(e) (v)(a)
(vi)(d) (vii)(e)
27.6 Further Readings

1. Indian Economy ; Gaurav Datt and Aswani Mahajan; S. Chand and Company
LTD. Ram Nagar, New Delhi-110055.
2. The Indian Economy ; S.K. Ray; Prentic, Hall of India Private Limited
New Delhi - 110001.

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