Impact of Public Expenditure on Agricultural Output in Karnataka: An Analysis

The Indian economy still relies heavily on agriculture, which is also a core component of its socio-economic progress. A little over 54.6 per cent of the workforce (as of the 2011 census) derives some level of support from agriculture sector, which contributes around 21.1 per cent of GDP. Due of its extensive backward and forward connections, agriculture's success greatly influences the development of other sectors as well as the economy as a whole. It is not only a source of livelihood and food security for a sizeable portion of India's people. Public expenditure plays a pivotal role in increasing economic size as well as agriculture sector output in Karnataka state. The study regresses public expenditure and agriculture output on gross state domestic product to find out the impact of public expenditure and agriculture output on economic size of Karnataka. The OLS empirical results found that public expenditure and agriculture output have a significant positive impact on economic size of Karnataka at one percent level of statistical significance. The regression outcomes find that, the public expenditure of Agriculture and Allied Activities have positive effects on agriculture output in Karnataka at one percent level of statistically significance. Therefore, study suggests that the state of Karnataka should prioritize increased public expenditure in agriculture and allied activities, with a particular focus on capital expenditure rather than revenue expenditure.