How Intersecting State Paternalism, Low Aspirations and Relative Satisfaction Preserve the Inertia of Rural Livelihoods in Odisha

ABSTRACT Rural Odisha, located along the eastern coast of India, has experienced slow economic growth over the past decade. This article employs a perspective rooted in the political economy of rural livelihoods to explore how and why this stagnation manifests among farmers. The case study focuses on farming households in a socioecologically homogeneous area with an upgraded irrigation scheme in an interior area in the northeastern side of the state. It uses longitudinal data from structured interviews in 2010/11 and 2022/23 with the same 175 households, supplemented by 64 semistructured interviews with local actors including farmers, local functionaries, government officers, and private actors. Our framework analyses the interplay of livelihood dynamics, aspiration formation, political economic drivers, ecological contexts and local innovation systems. The findings reveal a trajectory of structural change with limited livelihood dynamism, particularly in agriculture and crop diversification, though more changes were observed in nonfarm livelihoods. Limited agricultural dynamism was driven by modest aspirations and reinforced by paternalistic governance that undermines farmer agency. The study enhances our longitudinal understanding of agrarian change and livelihood dynamics with intergenerational differences.