Consider the following statements : Small-scale industries are, in most cases, not as efficient and competitive as the large-scale ones. Yet the Government provides preferential treatment and reservations in a range of products to the small firms because

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Q: 43 (IAS/1999)
Consider the following statements : Small-scale industries are, in most cases, not as efficient and competitive as the large-scale ones. Yet the Government provides preferential treatment and reservations in a range of products to the small firms because small-scale industries
I. provide higher employment on a per unit capital deployment basis.
II. promote a regional dispersion of industries and economic activities.
III. have performed better in export of manufactured products than the large scale ones.
IV. provide jobs to low-skill workers, who otherwise may not find employment avenues elsewhere.
Which of the above statements are correct ?

question_subject: 

Economics

question_exam: 

IAS

stats: 

0,69,46,69,22,11,13

keywords: 

{'scale industries': [0, 1, 1, 0], 'higher employment': [0, 1, 0, 0], 'industries': [6, 0, 2, 2], 'small firms': [0, 1, 0, 0], 'economic activities': [0, 1, 0, 2], 'employment avenues': [0, 1, 0, 0], 'unit capital deployment basis': [0, 1, 0, 0], 'preferential treatment': [0, 1, 0, 1], 'large scale ones': [0, 1, 0, 0], 'products': [1, 3, 4, 8], 'scale ones': [0, 1, 0, 0], 'skill workers': [0, 1, 0, 0]}

The statements I and IV are correct and hence, Option 1 is the correct answer.

Statement I is accurate because small-scale industries typically require less capital investment but employ more people, hence providing higher employment on a per unit capital deployment basis.

Statement IV is also true. Small-scale industries often offer employment to low-skilled workers, which could be a significant source of income for them if other employment avenues are closed.

Statement II suggests that small-scale industries promote a regional dispersion of industries and economic activities. While this statement may have some credibility, it isn`t the primary reason why governments support small-scale industries, making it less accurate than statements I and IV.

Statement III claims that small-scale industries have performed better in the export of manufactured products than the large-scale ones. This statement isn`t necessarily accurate. While small firms can be successful exporters, large firms often have the resources and connections to engage in significant export activities.