60 SOCIAL SCIENTIST Bagchi's canvas is rather wide and the hypotheses rather too general. He does not follow up the implications of his proposals. Probably the same constraints of 'social structure9 which he recognises as currently operative could vitiate the plan of 'decentralisation'. The mobilisation of surplus adequate to finance public production of mass consumption goods is bound to pose a problem, even if we leave aside the question of commodity distribution. Food grains illustrate a situation where substantial increases in production have not averted price rises or maldistribution. The strategy of encouraging labour-intensive, small-scale production, within the present set-up, has not had the kind of success Bagchi would anticipate. Evidently Bagchi has in mind a much vaster design of state policy which would be required in order to integrate together the individual components he spells out. Deepak Nayyar's paper also stresses the deficiency-of-demand argument and is also couched in rather general terms. After discussing and rejecting a number of alternative hypotheses attempting to explain industrial stagnation after the mid-sixties, for example, those relying on conjunctural and exogenous factors like wars, droughts, infrastructural constraints or the oil-shock (on the grounds that they do not explain the long-term character of the stagnation), or those focussing on the resource allocational inefficiency of licensing and controls (on the grounds that the more controlled regime of the sixties saw faster growth than the more 'liberalised' regime thereafter and that the premises of the argument rest on static competitive models inadequate for dealing with the dynamic setting of growth), or those highlighting agricultural deceleration (on the grounds that periods of improved agricultural performance have not per se led to faster industrial growth), or those emphasising the stagnation in real public investment (on the grounds, among other things, that public investment itself is equally constrained by the 'demand factor'), Nayyar concludes that any satisfactory explanation of stagnation cannot ignore "the relationship between income distribution, the demand factor and industrial growth". While focussing on the 'demand factor9, which he believes has been neglected, Nayyar attempts to unify it with other arguments, particularly bringing in the role of public investment and of the agricultural surpluses. His description of the growth process since 1950 runs as follows: "Irrespective of the income distribution at that time (i.e. 1950-66), there was an assured domestic market the size of which was determined by the level of imports and the size of excess demand for importables. This guaranteed source of demand was exhausted once import substitution in consumer goods was virtually complete, and the capacities created in the capital goods and the intermediate goods transcended the prudent needs of the final goods sector". Nayyar considers that the search for export markets would not be fruitful. He argues that