Wage-Goods-Model by Brahmanand

Professor Brahmanand had proposed wage goods model by criticising Mahalnobis' heavy industry model.  Wage goods are those goods which are consumed by common persons, like food, sugar, cloths, oil, milk, fruit, fish, rice, match box, soap, salt etc.  He emphasised that, the main problem in the elimination of disguised unemployment in Indian Agriculture is deficiency of wage goods. Employment may be increased if production of wage goods are increased.  He proposed that government should provide wages to labours, that able them to consume minimum wage goods. There is large wage goods gap for Agricultural labour when they are employ in other sectors. For example, an agricultural labour spends Rs. 250 for his minimum requirement of wage goods in rural area. If she/he employed at urban area, he may spent Rs. 400 for consumption of the same wage goods. This leads wage goods gap or Rs. 400-250=150. This is due to the increase of cost of wage goods when they are transported from rural market to urban market. In rural area, some wage goods are produced by consumers itself rather than buying them. It reduces the expenditure on wage goods in rural area.  If wage goods are produced sufficiently then prices of these goods may be kept low. Thus it keeps the expenditure on wage goods in urban area too.  Reduction in expenditure in urban area may accelerate re-employment of agricultural labour from rural area to urban area.