This chapter addresses the causes and effects of state economic growth. The analysis of the growth process is based on the pioneering research of scholars such as Kuznets (1966, 1973), Denison (1974) and Kendrick (1961), 1 who provided guidelines for monitoring economic activity. Their research focused on the determinants of economic growth, the measures of the growth process, and the ramifications of economic growth throughout the economy. Their findings provide a generalization of the Western growth experience, one that offers insights into the process but does not necessarily serve as a standard for judging performance in different situations. Its applicability to the Indian case is examined in this chapter. In the first section, the structural transformation of the state economies is described. In the second part, an analysis is conducted into die relative importance of technological change and mere input increases in the determination of the source of economic growth.