Which is More Important for UPSC Civil Services Exam - Macroeconomics or Microeconomics?
To comprehend the significance of both micro and macroeconomics in the context of UPSC CSE, it’s essential to delve into the UPSC Prelims and Main exam syllabus for Economics. UPSC Preliminary Exam Syllabus for Economics
- Economic and Social Development - Sustainable Development
- Poverty Alleviation
- Inclusive Growth
- Demographic Trends
- Initiatives in Social Sector
UPSC Main Exam Syllabus for Economics
In the Main examination, Economics forms a part of General Studies - III . The economics syllabus encompasses:
- Indian Economy and issues related to planning, resource mobilization, growth, development, and employment
- Inclusive growth and challenges arising from it
- Government Budgeting
- Major crops, cropping patterns in various parts of the country, different types of irrigation systems, transport and marketing of agricultural produce, and issues and constraints related to them; e-technology in the aid of farmers
- Issues related to direct and indirect farm subsidies and minimum support prices; Public Distribution System – objectives, functioning, limitations, revamping; issues of buffer stocks and food security; Technology missions; economics of animal-rearing
- Food processing and related industries in India – scope and significance, location, upstream and downstream requirements, supply chain management
- Land reforms in India
- Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth
- Infrastructure: Energy, Ports, Roads, Airports, Railways, etc.
- Investment models
By analyzing the UPSC syllabus mentioned above and previous years’ questions, it becomes evident that the majority of the areas are associated with macroeconomics, the Indian economy , public finance, banking, and more. The UPSC generally emphasizes current and static information, particularly related to India. Significant events that impact the global economy and business are also part of the exam. Therefore, to prepare for economics, aspirants should study:
- Indian Economic Development (Class 11 NCERT)
- Macroeconomics (Class 12 NCERT)
- Microeconomics (Class 12 NCERT) - Review crucial concepts
- Indian Economy by Ramesh Singh or The Indian Economy by Sanjiv Verma
- Economic Survey
- Union Budget
- Newspapers for current affairs
It is crucial to cover these resources for a comprehensive understanding of Economics.
Key Points to Remember: How to prepare for UPSC CSE Economics Topics
- The Macroeconomics NCERT textbook may be outdated, which necessitates referring to other Indian economy textbooks, Economic Surveys, and newspapers for current data.
- Make a note of significant government schemes.
- While reading the newspaper, look for important information related to business and economics like repo rate, cryptocurrency, Brent Crude Oil, etc. and jot it down.
- Be sure to go through important and relevant chapters of the Economic Survey .
- Review the Union Budget
Important Components of Macro and Microeconomics
The crucial topics that form a part of the Micro and Macroeconomics NCERT textbooks are mentioned below.
Topics that are part of Microeconomics and Macroeconomics
| S.No. |
Macroeconomics Topics |
Microeconomics Topics |
| 1 |
National Income Accounting: The Product or Value Added Method, Expenditure Method, Income Method, GDP and prices |
Central problems of an economy |
| 2 |
Money and Banking: Demand and supply of money, RBI, Monetary policy |
The Consumer’s Budget |
| 3 |
Income determination: the multiplier mechanism |
Preferences of the Consumer: Diminishing Rate of Substitution, Indifference Curve, utility |
| 4 |
Government budget: Revenue account, capital account, deficit |
Demand: Normal and inferior goods, substitutes and complements, shifts in the demand curve |
| 5 |
Fiscal policy: taxation, public debt, government expenditure |
Elasticity of demand |
| 6 |
Balance of Payments: BoP surplus and deficit |
Production and cost |
| 7 |
The Foreign Exchange Market: Determination of the Exchange Rate, Flexible Exchange Rates, Fixed Exchange Rates, Managed Floating, Exchange Rate Management |
Perfect competition |
| 8 |
The Determination of Income in an Open Economy |
Market equilibrium |
| 9 |
Trade Deficits, Savings and Investment |
Non-competitive markets: Monopolistic competition, Oligopoly |
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