Indian Economic Service Syllabus UPSC IES ISS Exam Pattern

UPSC ISS / IES Exam Scheme :

The examination shall be conducted according to the following plan:

Part I: Written Examination

UPSC IES Exam Pattern:

Type of Exam: Written Test

Duration: 3 Hours

Subject	Marks
General English	100
General Studies	100
General Economics-I	200
General Economics-II	200
General Economics-III	200
Indian Economics	200
Total	1000

UPSC IES Exam Pattern & Marks

UPSC Indian Statistical Service (ISS) Exam Pattern

Subjects	Max. Marks	Exam Duration
General English	100	3 hours
General Studies	100	3 hours
Statistics-I (Objective)	200	2 Hours
Statistics-II (Objective)	200	2 Hours
Statistics-III (Subjective)	200	3 Hours
Statistics-IV (Subjective)	200	3 Hours
Total	1000

UPSC Indian Statistical Service (ISS) Exam Pattern

UPSC Indian Economic Service (IES) Syllabus

Indian Economic Service Syllabus – General English	General English papers will be made available for an essay in English. There will be other questions to know the basic understanding of candidates and the use of words in English. Also, Unseen passages will be given for summarizing.
UPSC IES/ISS Syllabus -General study	Current Events -National & InternationalIndian GeographyIndian HistoryIndian PolityIndian ConstitutionPolicy & GovernanceEnvironmental StudiesScience & Technology etc
UPSC IES Syllabus – General Economics I	Theory of Consumer’s DemandTheory of ProductionWelfare EconomicsTheory of ValueTheory of DistributionQuantitative Methods in Economics
UPSC General Economics II Syllabus	Economic ThoughtThe Concept of National Income and Social AccountingTheory of Employment, Money & FinanceFinancial and Capital MarketEconomic growth and development international EconomicsBalance of PaymentsGlobal Institutions
UPSC Indian Economic Service General Economics III Syllabus	Public FinanceEnvironmental EconomicsIndustrial EconomicsState, market, and planning
UPSC IES Indian Economics Syllabus	History of development & PlanningFederal FinanceBudgetingPoverty, unemployment, and Human DevelopmentAgricultureStrategy of Industrial developmentLabourForeign TradeMoney and BankingInflation

UPSCIndian Economic Service (IES) Syllabus

General Economics I:

Part A

Theory of Consumer’s Demand:

Cardinal utility Analysis; Marginal utility and demand, Consumer surplus, Indifference curve Analysis and utility function, Price income and substitution effects, Slutsky theorem and derivation of the demand curve, Revealed preference theory. Duality and indirect utility function and expenditure function, Choice under risk and uncertainty. Simple games of complete information, Concept of Nash equilibrium

Theory of Production:

Factors of production and production function. Forms of Production Functions: Cobb Douglas, CES and Fixed coefficient type, Translog production function. Laws of return, Returns to scale and Return to factors of production. Duality and cost function, Measures of productive efficiency of firms, technical and allocative efficiency.

Theory of Value:

Pricing under different market structures, public sector pricing, marginal cost pricing, peak-load pricing, cross-subsidy free pricing and average cost pricing. Marshallian and Walrasian stability analysis. Pricing with incomplete information and moral hazard problems.

Theory of Distribution:

Neoclassical distribution theories; Marginal productivity theory of the determination of factor prices, Factor shares and adding up problems. Euler’s theorem, Pricing of factors under imperfect competition, monopoly and bilateral monopoly. Macro-distribution theories of Ricardo, Marx, Kaldor, Kalecki.

Welfare Economics:

Inter-personal comparison and aggregation problem, Public goods and externalities, Divergence between social and private welfare, compensation principle. Pareto optimality. Social choice and other recent schools, including Coase and Sen.

Part B

Mathematical Methods in Economics:

Differentiation and Integration and their application in economics. Optimisation techniques, Sets, Matrices and their application in economics. Linear algebra and Linear programming in economics and Input-output model of Leontief.

Statistical and Econometric Methods:

Measures of central tendency and dispersions, Correlation and Regression. Time series. Index numbers. A sampling of curves based on various linear and non-linear functions. Least square methods and other multivariate analyses (only concepts and interpretation of results). Analysis of Variance, Factor analysis, Principle component analysis, Discriminant analysis.

Income distribution: Pareto law of Distribution, lognormal distribution, measurement of income inequality. Lorenz curve and Gini coefficient. Univariate and multivariate regression analysis. Problems and remedies of Heteroscedasticity, Autocorrelation and Multicollinearity.

General Economics II:

Economic Thought:

Mercantilism Physiocrats, Classical, Marxist, Neo-classical, Keynesian and Monetarist schools of thought.

Concept of National Income and Social Accounting:

Measurement of National Income, Inter relationship between three measures of national income in the presence of Government sector and International transactions. Environmental considerations, Green national income.

Theory of employment, Output, Inflation, Money and Finance:

The Classical Theory of Employment and Output and Neo classical approaches. Equilibrium, analysis under classical and neoclassical analysis. Keynesian theory of Employment and output. Post-Keynesian developments. The inflationary gap; Demand pull versus cost-push inflation, Philip’s curve and its policy implication. The classical theory of Money, the Quantity Theory of Money. Friedman’s restatement of the quantity theory, the neutrality of money. The supply and demand for loanable funds and equilibrium in financial markets, Keynes’ theory on demand for money. IS-LM Model and AD-AS Model in Keynesian Theory.

Financial and Capital Market:

Finance and economic development, financial markets, stock market, gift market, banking and insurance. Equity markets, Role of primary and secondary markets and efficiency, Derivatives markets; Future and options.

Economic Growth and Development:

Concepts of Economic Growth and Development and their measurement: characteristics of less developed countries and obstacles to their development – growth, poverty and income distribution. Theories of growth: Classical Approach: Adam Smith, Marx and Schumpeter- Neo classical approach; Robinson, Solow, Kaldor and Harrod Domar.

Theories of Economic Development, Rostow, Rosenstein-Roden, Nurske, Hirschman, Leibenstien and Arthur Lewis, Amin and Frank (Dependency scool) respective role of state and the market. Utilitarian and Welfarist approach to social development and A.K. Sen’s critique. Sen’s capability approach to economic development. The Human Development Index. Physical quality of Life Index and Human Poverty Index. Basics of Endogenous Growth Theory.

International Economics:

Gains from International Trade, Terms of Trade, policy, international trade and economic development- Theories of International Trade; Ricardo, Haberler, Heckscher- Ohlin and Stopler- Samuelson- Theory of Tariffs- Regional Trade Arrangements. ASEAN Crisis of 1998, Global Financial Crisis of 2008 and Euro Zone Crisis- Causes and Impact.

Balance of Payments:

Disequilibrium in Balance of Payments, Mechanism of Adjustments, Foreign Trade Multiplier, Exchange Rates, Import and Exchange Controls and Multiple Exchange Rates. IS-LM Model and Mundell- Fleming Model of Balance of Payments.

Global Institutions:

UN agencies dealing with economic aspects, World Bank, IMF and WTO, Multinational Corporations. G-20.

General Economics III:

Public Finance:

Theories of taxation: Optimal taxes and tax reforms, the incidence of taxation; Theories of public expenditure: objectives and effects of public expenditure, public expenditure policy and social cost-benefit analysis, criteria of public investment decisions, social rate of discount, the shadow price of an investment, unskilled labour and foreign exchange. Budgetary deficits. Theory of public debt management.

Environmental Economics:

Sustainable development, Rio process 1992 to 2012, Green GDP, UN Methodology of Integrated Environmental and Economic Accounting. Environmental Values: User and Non-Users values; option value. Valuation Methods: Stated and revealed preference methods. Design of Environmental Policy Instruments: Pollution Taxes and Pollution permits, collective action and informal regulation by local communities.

Theories of exhaustible and renewable resources. International Environmental agreements, RIO Conventions. Climate change problems. Kyoto Protocol, UNFCC, Bali Action Plan, post-2015 agreements, tradable permits and carbon taxes. Carbon Markets and Market Mechanisms. Climate Change Finance and Green Climate Fund.

Industrial Economics:

Market structure, conduct and performance of firms, product differentiation and market concentration, monopolistic price theory and oligopolistic interdependence and pricing, entry preventing pricing, micro level investment decisions and the behaviour of firms, research and development and innovation, market structure and profitability, public policy and development of firms.

State, Market and Planning:

Planning in a developing economy. Planning regulation and market. Indicative Planning. Decentralized Planning.

Indian Economics:

History of Development and Planning:

Alternative Development Strategies- the goal of self-reliance based on import substitution and protection, the post-1991 globalisation strategies based on stabilization and structural adjustment packages: fiscal reforms, financial sector reforms and trade reforms.

Federal Finance:

Constitutional provisions relating to fiscal and financial powers of the states, Finance Commissions and their formulae for sharing taxes, Financial aspect of Sarkaria Commission Report, Financial aspects of 73rd and 74th Constitutional Amendments.

Budgeting and Fiscal Policy:

Tax, expenditure, budgetary deficits, pension and fiscal reforms, Public debt management and reforms, Fiscal Responsibility and Budget Management (FRBM) Act, Black Money and Parallel economy in India definition, estimates, genesis, con¬sequences and remedies

Poverty Unemployment and Human Development:

Estimates of inequality and poverty measures for India, appraisal of Government measures, India’s human development record in global perspective. India’s population policy and development.

Agriculture and Rural Development Strategies:

Technologies and institutions, land rela¬tions and land reforms, rural credit, modern farm inputs and marketing- price policy and sub¬sidies; commercialization and diversification. Rural development programmes include poverty alleviation programmes, development of economic and social infrastructure and the New Rural Employment Guarantee Scheme.

India’s experience with Urbanisation and Migration:

Different types of migratory flows and their impact on the economies of their origin and destination, the process of growth of urban settlements; urban development strategies.

Industry:

The strategy of Industrial development: Industrial Policy Reforms; Reservation Policy relating to small scale industries. Competition policy, Sources of industrial finances. Bank, share market, insurance companies, pension funds, non-banking sources and foreign direct investment, the role of foreign capital for direct investment and portfolio investment, Public Sector reform, privatization and disinvestments.

Labour:

Employment, unemployment and under-employment, industrial relations and labour welfare- strategies for employment generation- The urban labour market and informal sec¬tor employment, Report of National Commission on Labour, Social issues relating to labour e.g. Child Labour, Bonded Labour, International Labour Standard and its impact.

Foreign Trade:

Salient features of India’s foreign trade, composition, direction and organi¬zation of trade, recent changes in trade policy, the balance of payments, tariff policy, exchange rate, India and WTO requirements. Bilateral Trade Agreements and their implications.

Money and Banking:

Financial sector reforms, Organisation of India’s money market, changing roles of Reserve Bank of India, commercial banks, development finance institutions, foreign banks and non-banking financial institutions, Indian capital market and SEBI, Development in Global Financial Market and its relationship with Indian Financial Sector. Commodity Market in India- Spot and Futures Market, Role of FMC.

Inflation:

Definition, trends, estimates, consequences and remedies (control): Wholesale Price Index, Consumer Price Index: components and trends.

Statistics I:

Probability:

Elements of measure theory, Classical definitions and axiomatic approach. Sample space. Class of events and Probability measure. Laws of total and compound probability. Probability of m events out of n. Conditional probability, Bayes’ theorem. Random variables – discrete and continuous. Distribution function.

Standard probability distributions – Bernoulli, uniform, binomial, Poisson, geometric, rectangular, exponential, normal, Cauchy, hypergeometric, multinomial, Laplace, negative binomial, beta, gamma, lognormal and compound.

Poisson distribution. Joint distributions, conditional distributions, Distributions of functions of random variables. Convergence in distribution, in probability, with probability one and in mean square. Moments and cumulants.

Mathematical expectation and conditional expectation. Characteristic function and moment and probability generating functions Inversion uniqueness and continuity theorems. Borel 0-1 law: Kolmogorov’s 0-1 law. Tchebycheff’s and Kolmogorov’s inequalities. Laws of large numbers and central limit theorems for independent variables. Conditional expectation and Martingales.

Statistical Methods:

Collection, compilation and presentation of data, Charts, diagrams and histogram. Frequency distribution. Measures of location, dispersion, skewness and kurtosis. Bivariate and multivariate data.

Association and contingency. Curve fitting and orthogonal polynomials. Bivariate normal distribution. regression-linear, polynomial. Distribution of the correlation coefficient, Partial and multiple correlations, Intraclass correlation, Correlation ratio.

Standard errors and large sample test. Sampling distributions of x,s2, t, chi-square and F; tests of significance based on them, Small sample tests.

Non-parametric tests-Goodness of fit, sign, median, run, Wilcoxon, Mann-Whitney, Wald-Wolfowitz and Kolmogorov-Smirnov. Rank order statistics-minimum, maximum, range and median. Concept of Asymptotic relative efficiency.

Numerical Analysis:

Interpolation formulae (with remainder terms) due to Lagrange, Newton-Gregory, Newton Divided different, Gauss and Stirling. Euler-Maclaurin’s summation formula. Inverse interpolation. Numerical integration and differentiation. Difference equations of the first order. Linear difference equations with constant coefficients.

Statistics II:

Linear Models:

Theory of linear estimation. Gauss-Markoff setup. Least square estimators. Use of g-inverse. analysis of one-way and two way classified data-fixed, mixed and random effect models. Tests for regression coefficients.

Estimation:

Characteristics of a good estimator. Estimation methods of maximum likelihood, minimum chi-square, moments and least squares. Optimal properties of maximum likelihood estimators. Minimum variance unbiased estimators.

Minimum variance bound estimators. Cramer-Rao inequality. Bhattacharya bounds. Sufficient estimator. factorisation theorem. Complete statistics. Rao-Blackwell theorem. Confidence interval estimation. Optimum confidence bounds. Resampling, Bootstrap and Jackknife.

Hypotheses testing and Statistical Quality Control:

a) Hypothesis testing: Simple and composite hypothesis. Two kinds of error. Critical region. Different types of critical regions and similar regions.

Power function. Most powerful and uniformly most powerful tests. Neyman-Pearson fundamental lemma. Unbiased test. Randomised test. Likelihood ratio test. Wald’s SPRT, OC and ASN functions. Elements of decision and game theory.

b) Statistical Quality Control: Control Charts for variables and attributes. Acceptance Sampling by attributes-Single, double, multiple and sequential Sampling plans; Concepts of AOQL and ATI; Acceptance Sampling by variables-use of Dodge-Romig and other tables.

Multivariate Analysis:

Multivariate normal distribution. Estimation of mean vector and covariance matrix. Distribution of Hotelling’s T2-statistic, Mahalanobis’s D2-statistic, and their use in testing. Partial and multiple correlation coefficients in samples from a multivariate normal population. Wishart’s distribution, its reproductive and other properties. Wilk’s criterion. Discriminant function. Principal components. Canonical variates and correlations

Statistics III:

i) Sampling Techniques:

Census versus sample survey. Pilot and large scale sample surveys. Role of NSS organisation. Simple random sampling with and without replacement. Stratified sampling and sample allocations.

Cos and Variance functions. Ratio and Regression methods of estimation. Sampling with probability proportional to size. Cluster, double, multiphase, multistage and systematic sampling. Interpenetrating sub-sampling. Non-sampling errors.

ii) Design and Analysis of Experiments

Principles of design of experiments. Layout and analysis of completely randomised, randomised block and Latin square designs. Factorial experiments and confounding in 2n and 3n experiments. Split-plot and strip-plot designs. Construction and analysis of balanced and partially balanced incomplete block designs. Analysis of covariance. Analysis of non-orthogonal data. analysis of missing and mixed plot data.

iii) Economic Statistics

Components of time series. Methods of their determination-variate difference method. Yule-Slutsky effect. Correlogram. Autoregressive models of first and second order. Periodogram analysis. Index numbers of prices and quantities and their relative merits. Construction of index numbers of wholesale and consumer prices. Income distribution-Pareto and Engel curves. Concentration curve.

iv) EconometricsTheory and analysis of consumer demand-specification and estimation of demand functions. Demand elasticities. Structure and model. Estimation of parameters in single equation model-classical least squares, generalised least-square, heteroscedasticity, serial correlation, multicollinearity, errors in the variable model. Simultaneous equation models-Identification, rank and other conditions. Indirect least squares and two-stage least squares. Short-term economic forecasting.

Statistics IV:

(i) Stochastic Processes

Specifications of a Stochastic Process, Markov chains, classification of states, limiting probabilities; stationary distribution; Random walk and Gambler’s ruin problem. Poisson process, Birth and death process; applications to Queues-M/M/I and M/M/C models. Branching Process.

(ii) Operations Research

Elements of linear programming. Simplex procedure. Principle of duality. Transport and assignment problems. Single and multi-period inventory control models. ABC analysis. General simulation problems. Replacement models for items that fail and or items that deteriorate.

(iii) Demography and Vital Statistics

The life table, its constitution and properties. Markham’s and Gompertz curves. National life tables. UN model life tables. Abridged life tables. Stable and stationary populations. Different birth rates. Total fertility rate. Gross and net reproduction rates. Different mortality rates. Standardised death rate. Internal and international migration: net migration. International and postcensal estimates. Projection method including logistic curve fitting. Decennial population census in India.

(iv) Computer Application and Data Processing

(a) Computer Application

Computer system concepts: Computer system components and functions. The Central Processing Unit, Main memory, Bit, Byte, Word, Input/Output Devices, Speeds and memory Capacities in computer systems.

Software concepts: Overview of Operating Systems, Types and Functions of Operating System, Application Software, Software for multi-tasking, multi-programming, Batch Processing Mode, Time sharing mode, Concept of System Support Programme, Overview of Existing Software packages on Word Processing and Spreadsheets.

Overview of an application Specific Programme: Flow charts, Basics of Algorithm, Fundamental of design and analysis of Algorithm; Basics of data structure, Queue, Stack.

(b) Data Processing

Data processing: Digital Number System, Number conversions, Binary representation of integers, Binary representation of real numbers, Logical Data element like character, fields, records, files, Fundamentals of data transmission and processing including error control and error processing.

Database management: Data Resource management. Database and file organisation and processing. (a) Direct, (b) Sequential, (c) Indexed Sequential file. Concepts of Client-Server architecture, Data Base Administrator. An overview of DBMS software.

UPSC Indian Statistical Service (ISS) Syllabus

SCHEME OF EXAMINATION

SECTION-I
The examination shall be conducted according to the following plan—Part I-Written examination carrying a maximum of 1000 marks in the subjects as shown below.

Part II-Viva of such candidates as may be called by the Commission carrying a maximum of 200 marks.

PART-I

For the subjects of the written examination under Part-I, the maximum marks allotted to each
subject/paper and the time allowed shall be as follows :

Indian Statistical Service

Sl.No	Subject	Maximum Marks	Time Allowed
1-	General English	100	3 hrs.
2-	General Studies	100	3 hrs.
3-	Statistics-I (Objective)	200	2 hrs.
4-	Statistics-II (Objective)	200	2 hrs.
5-	Statistics-III (Descriptive)	200	3 hrs.
6-	Statistics-IV (Descriptive)	200	3 hrs.

Indian Statistical Service

Penalty for Wrong Answers (in Objective Type Papers)
THERE WILL BE A PENALTY (NEGATIVE MARKING) FOR WRONG ANSWERS MARKED

Note-1: Statistics I & II will be of Objective Type Questions (80 questions with maximum
marks of 200 in each paper) to be attempted in 120 minutes.

At least one Short Answer and One Long Answer Question from
each section is compulsory.

In Statistics-IV, an equal number of questions i.e. 50% weightage from all the sub-sections below and candidates have to choose any two sub-sections and answers.

Note-3: The papers on General English and General Studies will be of subjective type.
Note-4: The details of the standard and syllabi for the examination are given in Section-II
below.

The question papers in all subjects will be of Conventional (essay) type except in Statistics Paper-I and Statistics Paper-II which are Objective Type Papers.

ALL QUESTION PAPERS MUST BE ANSWERED IN ENGLISH; QUESTION PAPERS WILL
BESET IN ENGLISH ONLY.

The Commission has the discretion to fix qualifying marks in any or all the subjects of the examination.

If a candidate’s handwriting is not easily legible, a deduction will be made on this account, from the total marks, otherwise accruing to him/her.

Marks will not be allotted for mere superficial knowledge, Credit will be given for orderly effective and exact expression combined with due the economy of words.

PART-II Viva

The candidate will be interviewed by a Board of competent and unbiased observers who will have before them a record of his/her career.

The object of the interview is to assess his/her suitability for the service for which he/she has competed. The interview is intended to supplement the written examination for testing the general and specialized knowledge and abilities of the candidate.

The candidate will be expected to have taken an intelligent interest not only in his/her subjects of academic study but also in events which are happening around him/her both within and outside his/her own State or Country as well as in modern currents of thought and in new discoveries which should arouse the curiosity of well-educated youth.

The Board will pay special attention to assessing the intellectual curiosity, critical powers of assimilation, the balance of judgment and the alertness of mind, the ability for social cohesion, the integrity of character initiative, and capacity for leadership. Indian Statistical Service Examination ISS

Frequently Asked Questions (FAQs)