Has there been an MSP hike for Kharif Crops? Prabhat Patnaik

Much has been written by now exposing the fraudulence of the government’s claims of a “historic” rise in the Minimum Support Price for kharif crops. It has been pointed out for instance that while the Swaminathan Committee had recommended that the MSP should be fixed at 50 percent above the cost of production C2 which includes rental on own land, a recommendation that the BJP in its 2014 election manifesto had promised to implement, the current MSP still falls way below that level.The claim that the government has fulfilled its campaign promise,made by the BJP and its subservient media, is…

The Proposed Abolition of the UGC Prabhat Patnaik

The Modi government is bringing in legislation in the coming Monsoon session of the Parliament to abolish the University Grants Commission. The UGC has two important roles at present. One is the distribution of funds to colleges and universities; this will now be handled by the Ministry of Human Resource Development. The other role is a regulatory one, which will now be taken over by a Higher Education Commission of India (HECI). This Commission however will have no funds to distribute. The proposed set-up will immensely increase political control over the academia. The fact that the distribution of funds will…

Why didn’t Socialism have Over-production Crises? Prabhat Patnaik

Socialism has collapsed over large tracts of the globe. Where it still exists, the economic regimes have undergone considerable reforms. Not surprisingly therefore the old socialist regimes are objects of much vilification these days. While capitalism, understandably, has a vested interest in promoting such vilification, the Left opponents of capitalism continue to remain too shell-shocked to counter it. There were to be sure serious problems with the earlier socialist regimes, which manifested themselves above all in a de-politicization of the working class whose class dictatorship they were supposed to represent. But at the same time it must never be forgotten…

Keynes or New-Keynesian: Why Not Teach Both? Rohit Azad

For economists, the Great Recession, the worst crisis the world economy has seen since the Great Depression of the 1930s, has highlighted the need for plurality in macroeconomics education. Ironically, however, there is a move towards greater insularity from alternative or contrasting points of view. Where as, what is required for vibrant policy making is an open-minded academic engagement between contesting viewpoints. In fact, there does not even exist a textbook which contrasts these contesting ideas in a tractable manner. This blog post is as an attempt to provide certain pointers towards developing macroeconomics in a unifiedframework. Macroeconomics as a subject…

Did This Straw Break the Finance Sector’s Back? T. Sabri Oncu

I will define the straw and start with quoting from my July 2017 H T Parekh Finance Column titled “Debts That  Cannot Be Paid Will Not Be” (Öncü 2017). With my June 2015 H T Parekh Finance Column article titled “When Will the Next Financial Crisis Start?” [Öncü 2015a] I initiated an investigation of the possibility of a new phase in the ongoing global financial crisis (GFC) that started in the summer of 2007. [This article was retitled on the Policy Research in Macroeconomics website as “What Straw Will Break the Finance Sector’s Back?” when it was republished three days…

George Soros on the Current Conjuncture Prabhat Patnaik

Billionaire financier George Soros has set financial markets aflutter by suggesting that a new world financial crisis is in the offing. In a speech he gave recently to a think-tank, he underscored the outflow of finance capital from the third world which is likely to catch these economies in a cycle of exchange rate depreciations and austerity. And he talked specifically of the European Union facing an “existential crisis” on account of three factors: its territorial disintegration as exemplified by Brexit, austerity, and the refugee crisis. The solution he offered for Europe was a typically Keynesian one which included a…

The Invisible Class Prabhat Patnaik

G.K.Chesterton has a well-known detective story involving Father Brown called “The Invisible Man”, where “invisibility” is supposed to characterize the postman: one is so used to seeing the postman come and go that one scarcely ever notices him. “Invisibility” in Chesterton’s sense however can get attached not just to an individual but to a whole class; and in our country, the peasantry undoubtedly is the “invisible class”. The peasantry has been called many things by many people, from “a sack of potatoes” to “an awkward class”. But it is above all an “invisible class” whose presence, and providing of essentials…

Who Says Labor Laws Are “Luxuries”? Servaas Storm and Jeronim Capaldo

A Standard recommendation given to late-industrializing economies by the economic advisors of the World Bank and the International Monetary Fund has been to refrain from imposing regulations on the labor market, or if such regulations are already in place, to abolish them. If you are a policymaker in a late-industrializing country, chances are you’ve been told that your problem, what is really holding your economy back, is excessive labor regulation – it is making your exports uncompetitive and chasing away capital. Laws “created to help workers often hurt them,” stated the 2008 World Bank’s Doing Business Report. To avoid any…

Walmart’s gamble and what it means for India C. P. Chandrasekhar

Much of the writing on Walmart’s purchase of a dominant 77 per cent stake in Flipkart, touted for long as India’s answer to Amazon, is focused on its size. At $16 billion, of which $14 billion goes to buy up the stakes of investors such as SoftBank from Japan and Naspers from South Africa, it is reportedly the biggest acquisition in the global e-commerce area, and way larger than $3.3 billion that Walmart paid for US web retailer Jet.com in a deal considered the largest purchase of a US e-commerce startup. With some existing shareholders exiting, Walmart now shares ownership…