ICAR AICE-JRF/SRF (PhD admission and fellowship) · India · National Testing Agency for ICAR
Original practice questions written to the published syllabus · not past papersHow economies grow and develop, what part agriculture plays as they transform, and how farm, trade, food, fiscal and climate policies differ across the world's agricultural economies, compared through cases from every continent.
In the exams: Economic and social issues papers in agricultural development bank and central bank officer recruitment (heavy); agricultural economics PhD entrance and fellowship examinations, development and policy units (heavy); agricultural, food and development policy modules in master's programmes on several continents (present)
How our questions for ICAR AICE-JRF/SRF spread across the units of Economic Development and Agricultural Economies of the World. Difficulty: 2 easy, 34 medium, 22 hard.
| Agricultural policy regimes and producer support | 8 | |
| Economics of climate change and natural resources | 8 | |
| Poverty and inequality | 7 | |
| Public finance and monetary basics | 6 | |
| Measuring growth and development | 5 | |
| Structural transformation and the role of agriculture | 5 | |
| Agricultural trade and the WTO | 5 | |
| Rural labour, migration and remittances | 4 | |
| Development institutions: World Bank, IMF, FAO and IFAD | 3 | |
| Country case comparisons | 3 | |
| Comparative development paths | 2 | |
| Food security and nutrition | 2 |
Choose an answer, then open the working. Each explanation says why the right answer is right and why the others are not.
A country's producer support estimate is 30 billion currency units, the value of farm production at farm gate is 150 billion and budgetary payments to producers are 30 billion. The percentage PSE is closest to:
C. 16.7 per cent
%PSE = PSE / (value of production + budgetary payments) × 100 = 30 / 180 × 100 = 16.7 per cent. Dividing by 150 alone gives 20.0, leaving payments out of gross farm receipts; 25.0 divides 30 by 120; 83.3 is the non-support share of receipts.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
Farmers receive 240 currency units per tonne of rice including per-tonne payments, and the border price is 200. The producer nominal protection coefficient (NPC) and its meaning are:
A. 1.20, farmers receive 20 per cent above world prices
NPC = producer price including output payments / border price = 240/200 = 1.20, so producers get 20 per cent more than at world prices. 0.83 inverts the ratio; NPC says nothing about a retail consumer subsidy; and support as a share of receipts is the %PSE, a different indicator.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
In a multidimensional poverty index, 20 per cent of people are multidimensionally poor (H = 0.20) and the poor are deprived on average in 45 per cent of the weighted indicators (A = 0.45). The MPI is:
D. 0.09
MPI = H × A = 0.20 × 0.45 = 0.09. 0.65 adds them, 0.25 subtracts them, and 0.44 divides H by A.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
A boom in natural gas exports causes the real exchange rate to appreciate and agricultural exports to decline. This is an example of:
A. Dutch disease
Dutch disease, named after the Netherlands after its gas discoveries, describes a resource boom that appreciates the real exchange rate and squeezes other tradable sectors such as agriculture and manufacturing. The J-curve concerns the time path of the trade balance after depreciation; Balassa–Samuelson concerns productivity-driven price levels.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
In the Harris–Todaro model, the urban wage is 200 currency units a day, the probability of finding an urban job is 0.6, and the rural wage is 100. What does the model predict?
C. Migration continues, because the expected urban wage of 120 exceeds 100
Expected urban wage = 0.6 × 200 = 120 > 100, so migration continues until the expected urban wage equals the rural wage, which happens mainly through rising urban unemployment, not a falling urban wage (the urban wage is institutionally fixed in the model). 80 wrongly multiplies 200 by the 0.4 unemployment probability.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
At a discount rate of 5 per cent a year, the present value of 1,000 currency units of avoided climate damage received in 30 years is closest to:
A. 231 currency units
PV = 1,000 / (1.05)^30 = 1,000 / 4.322 = 231. 400 uses simple rather than compound discounting, 1,000/(1 + 0.05 × 30); 4,322 compounds forward instead of discounting; 850 has no basis in the formula.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
A Pigouvian tax on a polluting farm input should be set equal to:
C. the marginal external damage at the efficient level of use
Pigou's rule sets the tax at marginal external cost at the social optimum, so private decisions internalise the externality. Average private cost, cumulative damage or doubling the price are not tied to the marginal externality.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
In several regions, groundwater for irrigation is pumped with flat-rate or free electricity, and water tables are falling. The core economic problem is that:
D. pumping's private marginal cost is far below its social cost
With zero marginal power cost and open access to the aquifer, each farmer pumps until the private marginal benefit is near zero, ignoring the cost to others (falling tables, higher future pumping costs). This is an open-access externality worsened by an input subsidy, not irrationality; the utility typically loses money on farm power.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
The term 'Washington Consensus', coined by John Williamson in 1989, refers to:
D. market-oriented reforms such as fiscal discipline and privatisation
Williamson listed ten reforms widely advocated by Washington-based institutions for Latin America: fiscal discipline, tax reform, liberalised interest and exchange rates, trade liberalisation, openness to FDI, privatisation, deregulation and secure property rights among them. The exchange-rate treaty describes Bretton Woods; 0.7 per cent is the UN aid target.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
Consumption-based Gini coefficients, used in many Asian and African surveys, compared with income-based Gini coefficients for the same population are typically:
C. lower, because consumption is smoother and more equal than income
Households save in good years and dissave in bad ones, and the rich save a larger share, so consumption is more equally distributed than income. Comparing a consumption Gini with an income Gini overstates the difference in inequality between countries.
Further reading: Laisha manual: Economic Development and Agricultural Economies of the World; Todaro and Smith, Economic Development; OECD PSE Manual; WTO Agreement on Agriculture; FAO SOFI
Ten here, 58 in the app. The Laisha app has every practice question we have written to ICAR AICE-JRF/SRF in this subject, marked as you go, with timed papers, a jump-to-unanswered list and a certificate when you pass at 70 per cent.
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