CHAPTER 1: Introduction and Conceptual Framework
1.1 Introduction
The traditional concept of economic development was based solely on the level of rapid economic growth as gauged by the GDP and the national income. Nevertheless, the experience in the developing countries demonstrated that the presence of high economic growth does not necessarily imply the decrease in the levels of poverty, inequality, or social injustice.[1] This has led to an appreciation of the idea of inclusive growth, which argues that the gains of economic growth should be distributed fairly across all sectors of society.[2]
Inclusiveness growth has the meaning of having a development process that not only maximizes economic production, it also makes equal access, and access to economic resources and outcomes, in particular, of the marginalised and vulnerable groups. It is also closely related to the concept of social justice that is interested in the fairness of wealth allocation and availability of opportunities as well as social benefits, and the elimination of structural disparities along the lines of class, caste, gender, region, or economic position.[3]
The linkage of law and economics and development play a major role in realising inclusive growth. Whereas economics offers the means to create growth, the institutional process fulfilled by law regulates markets, safeguards rights, redistributes resources and holds people to account. Legal practices in the form of constitutional ensures, welfare laws, labor legislations, and social security provisions have a major role to play in ensuring that economic growth is converted into socially fair products.[4]
The last few decades have witnessed a marked change in the development models where growth is no longer at its center but inclusion which is people centric as part of development.[5] In the case of developing economies such as India, inclusive growth is very topical as there is a systemic poverty, unemployment, inequalities in the regions and social inequalities.
Thus, to bring about inclusive growth, it is imperative to establish a powerful and sensitive law system that can boost equality, safeguard the vulnerable groups, and evenly redistribute economic gains.[6] Inclusive growth and social justice are two concepts that cannot exist independently with regard to law and development with law being an important tool that plays a crucial role in ensuring that the gap between economic development and social justice is bridged.[7]
1.2 Statement of Problem
Although most developing economies have been recording positive economic growth, the benefits have been very unevenly distributed. The growth has been concentrated to certain sectors, regions and social groups, losing a significant percentage of the population in the process of development. The poor, women, informal sector workers, and socially disadvantaged groupings in society still have hurdles in getting access to education, employment, health, and economic opportunities. This omission underscores the weakness of growth-based development frameworks, which mainly prioritise the expansion of national revenues without ensuring social justice.
Economic systems based on the market also foster inequality owing to market failures like asymmetry in bargaining power, information asymmetry and resource inaccessibility. Such circumstances enable players with fewer economic capacities to be controlled by markets, and weaker parts are subject to exploitation. Even though the provisions given in the constitutional provisions, labor laws and the welfare legislations are provided to encourage social justice and protect the vulnerable groups, these measures have been found to be weak through poor implementation, poor enforcement and also through the inefficiencies of the administration.
This has led to total failure to use the law as a viable tool to transform economic growth into inclusive development. The continued inequality and exclusion, which is still present even with the legal structures in place just goes to support the importance of a more solid law-based solution that balances social justice with economic growth and provides the people on either end of the society with equal prospects.
[1]Amartya Sen, Development as Freedom, 1st ed. 1999, pp. 14-38.
[2]Joseph E. Stiglitz, The Price of Inequality: How Today’s Divided Society Endangers Our Future, 1st ed. 2012, pp. 21-45.
[3]Martha C. Nussbaum, Creating Capabilities: The Human Development Approach, 1st ed. 2011, pp. 18-35.
[4]ConstitutionofIndia1950,Arts.14,15,21,38and39.
[5]Supra n. 2.
[6]Upendra Baxi, The Crises of Indian Legal System,1st ed.1982, pp. 112-130.
[7]Amartya Sen, “Social Justice and the Distribution of Income”, 39 ECONOMICA (1972), p. 1.