UPSC IES and ISS Syllabus

• Essay writing
• Understanding of English language and vocabulary
• Summary of Precis Writing
• Passages

• General Knowledge
• Geography
• Current Affairs
• Current events
• Indian Polity including the political system and the Constitution
• of India
• History of India

Part A:

• Theory of Consumer’s Demand—Cardinal utility Analysis: Marginal utility and demand, Consumer’s 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 Returns to factors of production. Duality and cost function, Measures of productive efficiency of firms, technical and allocative efficiency. Partial Equilibrium versus General Equilibrium approach. Equilibrium of the firm and industry. 
• 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: Neo classical 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. Macrodistribution theories of Ricardo, Marx, Kaldor, Kalecki. 
• Welfare Economics: Inter-personal comparison and aggression 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: Quantitative Methods in Economics 

• Mathematical Methods in Economics: Differentiation and Integration and their application in economics. Optimization 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, etc.

• 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 neo-classical approach. 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, etc.
• Financial and Capital Market: Finance and economic development, financial markets, stock market, gilt 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 school) 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. Asian Financial Crisis of 1997, 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, the role of Multilateral Development Bodies (MDBs), such as the World Bank, IMF, WTO, and Multinational Corporations. G-20.  

• 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, etc.
• Environmental Economics: Environmentally sustainable development, Rio process 1992 to 2012, Green GDP, UN Methodology of Integrated Environmental and Economic Accounting. Environmental Values: Users and Non-Users values, option value. Valuation Methods: Stated and revealed preference methods. Design of Environmental Policy Instruments, etc.
• 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 behavior of firms, etc.
• State, Market, and Planning: Planning in a developing economy. Planning regulation and market. Indicative planning. Decentralized planning.

• History of development and planning: Alternative development strategies—the goal of self-reliance based on import substitution and protection, the post-1991 globalization 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, etc.
• Poverty, Unemployment and Human Development: Estimates of inequality and poverty measures for India, appraisal of Government measures, India’s human development record in a global perspective. India’s population policy and development. 
• Agriculture and Rural Development Strategies: Technologies and institutions, land relations and land reforms, rural credit, modern farm inputs and marketing— price policy and subsidies; commercialisation and diversification. Rural development programmes include poverty alleviation programmes, the 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: Strategy of industrial development:  Industrial Policy Reform; Reservation Policy relating to small-scale industries. Competition policy, Sources of industrial finance. 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, privatisation and disinvestment.
• Labour: Employment, unemployment and underemployment, industrial relations and labour welfare: strategies for employment generation: Urban labour market and informal sector 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 organisation of trade, recent changes in trade, 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 the 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.

• Essay writing
• Understanding of English language and vocabulary
• Summary of Precis Writing
• Passages

• General Knowledge
• Geography
• Current Affairs
• Current events
• Indian Polity including the political system and the Constitution
• of India
• History of India

• Probability: Classical and axiomatic definitions of Probability and consequences. Law of total probability, Conditional probability, Bayes’ theorem, and applications. Discrete and continuous random variables. Distribution functions and their properties. Standard discrete and continuous probability distributions – Bernoulli, Uniform, Binomial, Poisson, Geometric, Rectangular, Exponential, Normal, Cauchy, Hypergeometric, Multinomial, Laplace, Negative binomial, Beta, Gamma, etc.
• Statistical Methods: Collection, compilation, and presentation of data, charts, diagrams, and histograms. 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, etc.
• Numerical Analysis: Finite differences of different orders, Concept of interpolation and extrapolation, Inverse interpolation, Numerical differentiation, Summation of Series, and Numerical solutions of differential equations.
• Computer application and Data Processing: Basics of Computer: Operations of a computer, Different units of a computer system like central processing unit, memory unit, arithmetic and logical unit, an input unit, output unit etc., Hardware including different types of input, output and peripheral devices, etc. Basics of Programming: Algorithm, Flowchart, Data, Information, Database, an overview of different programming languages, frontend and backend of a project, variables, control structures, arrays and their usages, functions, modules, loops, etc.

• Linear Models: Theory of linear estimation, Gauss: Markov linear models, estimable functions, error and estimation space, normal equations and least square estimators, estimation of error variance, estimation with correlated observations, properties of least square estimators, etc.
• Statistical Inference and Hypothesis Testing: Characteristics of 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, etc. Hypothesis testing: Simple and composite hypotheses. Two kinds of errors. Critical region. Different types of critical regions and similar regions. Power function. Most powerful and uniformly most powerful tests. Neyman-Pearson fundamental lemma, etc
• Official Statistics: National and International official statistical system, National Statistical Organization, National Statistical Commission, Index Numbers, Sector Wise Statistics, National Accounts, and Population Census.

• Sampling Techniques: Concept of population and sample, need for sampling, complete enumeration versus sampling, basic concepts in sampling, sampling and Non-sampling error, Methodologies in sample surveys (questionnaires, sampling design and methods followed in field investigation) by NSSO. Subjective or purposive sampling, probability sampling or random sampling, simple random sampling with and without replacement, estimation of population mean, population proportions and their standard errors. Stratified random sampling, proportional and optimum allocation, comparison with simple random sampling for fixed sample size. Covariance and Variance Function, etc.
• Econometrics: Nature of econometrics, the general linear model (GLM) and its extensions, ordinary least squares (OLS) estimation and prediction, generalized least squares (GLS) estimation and prediction, heteroscedastic disturbances, pure and mixed estimation. Autocorrelation, its consequences, and tests. Theil BLUS procedure, estimation and prediction, multi-collinearity problem, its implications and tools for handling the problem, etc.
• Applied Statistics: Index Numbers: Price relatives and quantity or volume relatives, Link and chain relatives composition of index numbers; Laspeyre’s, Paasches’, Marshal Edgeworth and Fisher index numbers; chain base index number, tests for index number, Construction of index numbers of wholesale and consumer prices, Income distribution-Pareto and Engel curves, Concentration curve, Methods of estimating national income, etc.

• Operations Research and Reliability: Definition and Scope of Operations Research: phases in Operation Research, models and their solutions, decision-making under uncertainty and risk, use of different criteria, sensitivity analysis. Transportation and assignment problems. Bellman’s principle of optimality, general formulation, computational methods and application of dynamic programming to LPP, etc.
• Demography and Vital Statistics: Sources of demographic data, census, registration, ad-hoc surveys, Hospital records, and Demographic profiles of the Indian Census. Complete life table and its main features, Uses of life table. Makehams and Gompertz curves. National life tables. UN model life tables. Abridged life tables. Stable and stationary populations, etc.
• Survival Analysis and Clinical Trial: Concept of time, order and random censoring, likelihood in the distributions – exponential, gamma, Weibull, lognormal, Pareto, Linear failure rate, inference for this distribution. Life tables, failure rate, mean residual life, and their elementary classes and their properties. Estimation of survival function – actuarial estimator, Kaplan – Meier estimator, estimation under the assumption of IFR/DFR, tests of exponentiality against non-parametric classes, total time on the test, etc.
• Quality Control: Statistical process and product control: Quality of a product, need for quality control, basic concept of process control, process capability and product control, general theory of control charts, causes of variation in quality, control limits, a sub-grouping summary of out of control criteria, charts for attributes p chart, np chart, c-chart, V chart, etc.
• Multivariate Analysis: Multivariate normal distribution and its properties. Random sampling from a multivariate normal distribution. Maximum likelihood estimators of parameters, distribution of sample mean vector, etc.
• Design and Analysis of Experiments: Analysis of variance for one-way and two-way classifications Need for the design of experiments, a basic principle of experimental design (randomization, replication, and local control), complete analysis and layout of the completely randomized design, randomized block design and Latin square design, Missing plot technique. Split Plot Design and Strip Plot Design, etc.
• Computing with C and R: Basics of C: Components of C language, the structure of a C program, Data type, basic data types, Enumerated data types, Derived data types, variable declaration, Local, Global, Parametric variables, Assignment of Variables, Numeric, Character, Real and String constants, Arithmetic, Relation and Logical operators, Assignment operators, Increment and decrement operators, conditional operators, etc.