Economics Notes for UPSC 2021: Which Topics Make it to The Economics Paper?

Economics can be overwhelming to others but the questions are focused on your conceptual understanding of macroeconomics. No matter how many times you read and mug the material, you are bound to underperform in the test. Conceptual clarity is the most critical part of economics.

On average, about 14-15 percent of the weight is given to Economics. If your basic economics funda is strong, you’ll even be able to get all the answers right in Prelims. So it is suggested is to spend more time learning concepts and analyzing how one concept is connected to another. In order to learn concepts, you will need to do note-making. So today’s focus is prepping you to make economic notes for UPSC.

How to Prepare for Economics Subject?

Current affairs are critical to the economics paper. This is because they depict the changing economy of India and the rest of the world. Following successful UPSC newspapers and magazines is an effective technique to keep up to date.
Focus on understanding your concepts on topics such as Niti Aayog, GST, Money Supply, Tax Structure, LPG Reform, Human Growth, Inflation, GDP, Banking. These are the main economic problems, and the questions you will get will be linked to one way or the other. The more clear your concepts will be, the better you will be able to attempt the questions.

Economic Books to Study for Prelims

You’ve got to find the right books that cover all these subjects in-depth as well as easy to read. Start your reading with the basics of the NCERT books and then gradually move to other books. Here is a list of reference books for you.

Indian Economy– Ramesh Singh
India economy since independence– Uma Kapila
Indian Economy– Mishra and Puri
Indian economy: Performance and policies- Uma Kapila
The Indian Economy Book– Sanjiv Verma

How to Make Economic Notes for UPSC? Making Notes from NCERT

Read the introduction before reading the chapter. Skim through the section headings of each chapter as well as the overview at the end of each chapter. This will provide an overall picture of what the chapter is all about and it will allow the prior awareness of the present chapter.
Take the help of margins while reading the textbook. Write key points and keywords in the margins.
Hold the pencil and paper in hand when reading. When a new idea is introduced, please take note of it. Solve the given examples and practice questions to gain a better understanding.
Carefully evaluate all models, graphics, and diagrams.
Recall the details by summing up the key points and evaluating yourself.
Think critically about what you’ve just read; then make notes of your observations.

Also Read: Economics Syllabus for UPSC IAS Exam

Which Topics Should You prepare Your Economic Notes on?

Focus making notes on:

Differences between inflation, depression, recession, miscellaneous terms such as speculation, Philip’s curve, deflation, disinflation, reflation, stagflation
Forms of inflation – depending on the rate of price rise – creeping, trotting, galloping;
Causes-based inflation – Demand-pull, Cost-pull, Structural
Cause of inflation in India and the effect of inflation on India’s economy
Inflation indicators such as CPI, WPI, PPI, GDP deflator – their structure, base years, merits/demerits, and who prints them at what frequency.
Basic year definition, recent changes, and the need for change

Let’s see if you can answer the previous year’s MCQ question based on these topics listed above.

Previous Year’s MCQ Question

India has experienced persistent and high food inflation in the recent past. What could be the reasons?

Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased in the last five years by about 30%.

As a consequence of increasing incomes, the consumption patterns of the people have undergone a significant change.

The food supply chain has structural constraints.

Which of the statements given above are correct?

a) 1 and 2 only

b) 2 and 3 only

c) 1 and 3 only

d) 1, 2 and 3

Answer

If you guessed b, then its the right answer!

Why is it b only? Let’s discuss

The first choice is clearly false. A 30 percent decrease in food grain area is too extreme to occur in 5 years because if it did, everybody would know about it. In fact, there is hardly any decrease in the area under cultivation of food grains. Eliminate 1, you’ve got the answer.

If you practice MCQs from past years you can definitely make observations and write it in your economic notes. What went wrong? What went right when you attempted such questions. Make note of it as you can adopt the same strategy in the actual economics exam.

Conclusion

The crucial thing about taking notes from books is your interpretation of the subject, so it’s sensible to write down what you understand in your own words. The re-writing of the source material does not help you memorize the material subconsciously. All you need to do is read the syllabus topics, find the questions from that particular concept in the previous year, and make the notes respectively.