Private investment plays a significant role in a capitalist economy. Capitalist economies that are growing are really concerned about the amount of investment that flows in. India with its stunning growth rates after embracing the global order saw a rise in investment from the household sector as well as from private institutions. Understanding growth and understanding policies to promote growth also involve an understanding of investment — how it is formed and what factors control it. There are theories of investment trying to explain why economies behave the way they are. The unpredictable nature of global economy makes the debate over the ‘most suitable’ theory interesting. CPPR Research Intern, Rajesh K P writes..
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