UPSC Mains 2013: (Solved) Economics Optional Paper 1

I am uploading here what I wrote in the Economics optional paper 1 of 2013 UPSC mains exam. This is just from memory and may not be accurate. You are most welcome to criticize/add to/suggest alternate answers :-) I am only putting up a link here because the formatting of wordpress leaves much to desire.

Click here to download the solved paper.

45 thoughts on “UPSC Mains 2013: (Solved) Economics Optional Paper 1”

  1. hey answers were great …i found the eco paper intriguing ..if u could really write all this, thats great, u can expect greta marks in first paper..

  2. is there a huge margin between gud and bad performance? as economics will b taken by only those havin a degree in it..what were the lowest marks for getting an
    interview call.

  3. Your answers were to the point and you had them supplemented them with graphs quite nicely. Did you graduate in economics or had some background in economics?

  4. Hello bro, answer for 1st question: Walras equilibrium conditions are
    1. Initial endownment = Final endownment(£ Xi=£Wi) where i=A, B
    2. No excess demand(ED=D(P)-S=0)
    Due to formatting concerns I’m using incorrect £ mathematical representations for summation.
    Unfortunately, you gave pareto’s view of exchange equil. and not Walras.
    Reference: Microeconomic theory: Basic principles and extensions chapter on General Equilibrium

      1. I am preparing for civil services 2015.
        I have one serious doubt about my optionaI subject. I am confused between Sociology and economics. I have done graduation in economics from BITS Pilani. However BITS being engg. college, economics was taught very superficially. We were just taught basic Principles of Economics, Microeconomics, Macroeconomics,Public finance, Money Banking in very superficial way. We were hardly told to study from books, we just referred slides, notes of class. This was just to give my academic background. I have interest in sociology and I have studied some basic books also.
        However one thing that has been bothering is that in recent times optionals like sociology, pub ad etc are not scoring anymore inspite of writing good answers. Even some professors i talked to in DU told in sociology at best score like 50% is maximum. How is economics optional from point of view of scoring? How much did you score in your last attempts Please tell pros and cons of eco, and any other advice please.

        1. Salil ji, 50% is the top score these days (unless u hv malyalam lit or botany etc.). Eco paper 1 marking is tough, paper 2 is relatively liberal. Overall ppl do tend to score in eco, dont know abt socio, but heard paper last yr n this yr too was easy. I wud suggest u not to wrry abt scoring n take per ur interest n capability. There r always toppers in every subject n if u dont hv int, u cannot be among the toppers

  5. Hey Gaurav,

    your kaldor wala i think is right(I thought of the same logic)
    Bertrand wala mera final answer bhi same p=2 tha although i did not draw the indifference curves in cournot diagram…I ‘ll ask more questions when i read the whole thing.

    and thanks a ton for uploading…salute to your enthu for typing this out!

    and please can you upload paper II …please…some questions like dichotomy of development, rural connectivity i still have no clue…..
    Is inflation a monetary phenomenon…usmein kya all non-monetary causes responsible for inflation likhna tha?
    Moreover I would understand more of what do you mean when you say “one has to write like an economist”

    and you would have prepared e-notes for paper II…could you share those please

    thanks again

    1. Thanks suraj, but I m srry wont be able to upload paper 2 answers, at least for thet ime being.. Tired of uploading answers.

      Rural connectivity was PURA model by APJ Abdul Kalam, dichotomy of development – one needed to highlight the lopsided development which has taken place all this time… Urban vs rural, male vs female, backward vs general, agri vs industry etc.

      Inflation – one had to decompose the high inflation data, say it was due to non monetaryc auses, eg. Food, fuel.. Give the causes for food n fuel inflation… But finally say that sustained high inflation is everywhere a monetary phenomenon only… Rbi has failed to tighten monetary policy sufficiently demanded by the supply side factors.

      I ll c wot i can do on the notes front.

      1. But sustained high inflation could be due to supply side factors too.
        India’s food inflation especially in protein items is largely attributed due the inefficient supply chain and the monopoly causing APMC legislation.With service sector growth real demand for high end food products is increasing but the supply side response is absent. Even if RBI raises interest rates and curbs the investment demand (and some demand for consumer durables) this basic consumption demand is unlikely to respond.

        The above is true whether we talk of the long run or the short run. Some authors say part of the reason for sustained inflation in developing countries is infra deficit and inefficient markets – both of them independent of monetary policy.

        Please explain.

        1. Nahi yaar, sustained high inflation is alwayse verywhere purely a monetary phenomenon… Even If there r any structural supply sode issues, rbi is supposed to reduce money supply accordingly. In short run rbic ant predict supply side fluctuations, but long run factors have to be accounted for.

  6. Hi Gaurav,

    Your answer on public finance – 3 basic goals
    Musgrave says they are –
    i. Allocative(provide adequate proportion of public goods)
    ii. Distribution
    iii. Stabilisation of the economy(via fiscal policy – Keynesian eco)

    Did you made up those 3 goals or some book says?

  7. hi can u plz clarify whether one needs to write intro and conclusion in optional answers..I have Anthropology optional..the content of my answers and presentation is fine…but Sir at my test series insists that I should write an intro which summarises the main points of the whole answer…i am in doubt whether it is necessary or a sheer waste of time in exam..i am really confused about it..
    thanks :)

  8. Congratulations for your great success,,,can you please post a detailed strategy regarding the economics optional preparation..

  9. Hi gaurav, i am not able to get ur solved answers, when I am clicking the click here for download link, the page is showing some kind of programme or something but definitely not the answers…..Plss help me out…I am using android

  10. Hello sir i had economics in graduation and doing PG in economics should i take economics as an optional..???…plz tell the probability of getting good marks in it as even gaurav agarwal from IIM couldnt get good score as compared to other subjects

  11. Even after all this time , I come to this one particular blog for guidance on Eco optional. Kya site banayi hai Sir. And despite everything been provided already , people are still asking for more !

    Anyways, thanks a lot and God bless :)

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