The Story of Village Palampur Class 9 Notes Economics - Chapter 1

Chapter: 1

What Are the Story of Village Palampur?

Organisation Of Production

  • The aim of production is to produce the goods and services that we want. There are four requirements for production of goods and services.

Land, and other natural resources  such as water, forests, minerals.

Labour, i.e., people who will do the work.

Physical capital, i.e., the variety of inputs required at every stage during production. Ex: Tools, machines, buildings, Raw materials and money in hand.

Factor of production is organised by combining land, labour, physical capital and human capital.

Farming In Palampur

Land is Fixed

  • Land area under cultivation is practically fixed. Since 1960 in Palampur, there has been no expansion in land area under cultivation.
  • By then, some of the wastelands in the village had been converted to cultivable land. There exists no further scope to increase farm production by bringing new land under cultivation.


  • All land is cultivated in Palampur. No land is left idle.
  • During the rainy season (kharif) farmers grow jowar and bajra.
  • It is followed by cultivation of potato between October and December.
  • In the winter season (rabi), fields are sown with wheat.
  • The main reason why farmers are able to grow three different crops in a year in Palampur is due to the  well-developed system of irrigation.
  • To grow more than one crop on a piece of land during the year is known as multiple cropping. It is the most common way of increasing production on a given piece of land.

Modern Farming

  • Green revolution in Late 1960’s introduce high yield variety seeds for cultivation of wheat and rice.
  • Using High Yield Variety seeds (HYVs) instead of traditional seeds, which results in larger produce on the same piece of land.
  • HYV seeds, however, needed plenty of water and also chemical fertilizers and pesticides to produce best results.

Sustainability of Land

  • Land being a natural resource, so it is necessary to be careful in its use.
  • Scientific reports indicate that the modern farming methods have overused the natural resource base.
  • Loss of soil fertility due to increased use of chemical fertilizers.
  • Continuous use of groundwater for tube well irrigation has led to the depletion of the water-table.

Land Distribution

  • In Palampur, about one third of the 450 families are landless, i.e., 150 families, have no land for cultivation.
  • About 240 families cultivate small plots of land less than 2 hectares in size.
  • There are 60 families of medium and large farmers who cultivate more than 2 hectares of land.
  • A few of the large farmers have land extending over 10 hectares or more.
  • Distribution of cultivated land is unequal in Palampur, because few population control large area and large section of population have few land to cultivated.


  • Small farmers along with their families cultivate their own fields. Thus, they provide the labour required for farming themselves.
  • Medium and large farmers hire farm labourers to work on their fields.
  • Farm labourers come either from landless families or families cultivating small plots of land.
  • Unlike farmers, farm labourers do not have a right over the crops grown on the land. Instead, they are paid wages by the farmer for whom they work.


  • Modern farming methods require a great deal of capital, so that the farmer now needs more money than before.
  • Most of the small farmers have to borrow money to arrange for capital. They borrow from large farmers or the village moneylenders or the traders who supply various inputs for cultivation.
  • The medium and large farmers have their own savings from farming. They are thus able to arrange for the capital needed.

Sale of Surplus Farm Products

  • Small farmers sell their surplus product to the large or medium farmers.
  • Medium and large farmers sell their surplus directly to the market.

Non-farming Activities In Palampur

Only 25 per cent of the people working in Palampur are engaged in activities other than agriculture.

  • Dairy – the other common activity: Dairy is a common activity in many families. People feed their buffalos on various kinds of grass and the jowar and bajra that grows during the rainy season. And sell the milk obtained in the market.
  • Small-scale manufacturing: Unlike the manufacturing that takes place in the big factories in the towns and cities, manufacturing in Palampur involves very simple production methods and are done on a small scale. They are carried out mostly at home or in the fields with the help of family labour. Rarely are labourers
  • The shopkeepers: The traders of Palampur are shopkeepers who buy various goods from wholesale markets in the cities and sell them in the village. There are very small general stores in the village selling a wide range of items like rice, wheat, sugar, tea, oil, biscuits, soap, toothpaste, batteries, candles, notebooks, pen, pencil,
    even some cloth.
  • Transport: There are variety of vehicles on the road connecting Palampur to Raiganj. Rickshawallahs, tongawallahs, jeep, tractor, truck drivers and people driving the traditional bullock cart and bogey are people in the transport services. They ferry people and goods from one place to another, and in return get paid for it.