Shopping Frenzy in the New China C. P. Chandrasekhar

In an otherwise gloomy world economic environment, a new kind of record given the media bizarre cause to cheer: the value of online sales notched up by Chinese e-commerce giant Alibaba on a single discount sales day. Global business headlines screamed that in its annual sale on Singles’ Day, 11 November 2017, Alibaba had registered a record sales value of 168.2 billion yuan or $25.3 billion.  Singles’ Day, or 11 November, was, because of its 11/11 aspect, reportedly chosen around 25 years ago by students of Nanjing University to celebrate the fact of being single. Using what has evolved to…

The Crisis in Agriculture C. P. Chandrasekhar and Jayati Ghosh

The dilution of government intervention in the form of minimum support prices, procurement and public distribution is undermining the medium-term viability of agricultural production in India. crisis_in_agriculture (Download the full text in PDF format) (This article was originally published in the Business Line on October 23, 2017.)

Strangulating the Informal Economy Prabhat Patnaik

The fact that there has been a slowdown of late in the rate of growth of the Indian economy is accepted by all, including even Narendra Modi in his all-over-the-place diatribe against critics on October 4. The government however sees it as remediable since the economy, it believes, “is on the right track”. The first question to ask however is: why should it matter if the year-on-year quarterly GDP growth-rate has been slowing down for the last six consecutive quarters and is now down to 5.7 percent in the first quarter of 2017-18 (which is the lowest for any quarter…

The Growing Income Inequality Prabhat Patnaik

Thomas Piketty and Lucas Chancel have just written a paper as part of their work for the World Inequality Report discussing the movement of income inequality in India. And their conclusion is that the extent of income inequality in India at present is greater than it has ever been at any time in the last one hundred years. Their estimates go back to 1922 when the Income Tax Act became operational in India. The share of the top 1 percent of the population in total income at that date was around 13 percent. It increased to 21 percent by the…

Brexit and the Economics of Political Change in Developed Countries Jayati Ghosh

The economic forces underlying Brexit, and the election of Donald Trump in the US, are similar, but they are also well advanced in many European countries, where much of the population faces similar material insecurity and stagnation. These frustrations can easily be channelled by right-wing xenophobic forces. To combat this, the EU needs to undo some of its design flaws and particularly its adherence to fiscal austerity rules. Only a more progressive and more flexible union based on solidarity of peoples is likely to survive. Brexit_Economics (Download the full text in PDF format)

The Economy: 70 years after Independence C. P. Chandrasekhar

The defining feature of the economic programme of independent India’s first government was to accelerate the transition to a modern economy dominated by industry. Agriculture and related activities at that time accounted for around half of GDP and modern industry in the form of factory establishments for just above 6 per cent. Thus, colonial rule had made India the victim of the barriers to productivity increase typical of predominantly agrarian economies. These circumstances influenced the Nehruvian vision that made rapid diversification in favour of manufacturing the principal economic objective. The ‘big planners’ of that time did recognize that this will…

The Macroeconomics of Basic Income Grants Jayati Ghosh

In a time of short or no historical memory, it is easy to believe that some ideas are completely novel and innovative. So it is with the idea of the “Universal Basic Income”, which is getting much exposure in both developed and developing countries as a fundamentally new policy to deal with contemporary inequalities and the increasing uncertainty around employment generation. I have already considered some of the advantages and concerns with this idea, specifically in the Indian context, in a previous column (http://www.frontline.in/columns/Jayati_Ghosh/a-universal-basic-income-in-india/article9511636.ece). But it is worth looking in more detail at the history of this idea, and some…

China’s Labour Market Conundrum C.P. Chandrasekhar and Jayati Ghosh

Has China's labour market reached a point where long years of high growth have led to demand outstripping supply, resulting in a sharp rise in wages? China_Labour (Download the full text in PDF format) (This article was originally published in the Business Line on July 4, 2017.)

The Question of Farm-loan Waiver Prabhat Patnaik

The question of farm-loan waiver that is being demanded by the peasantry is much misunderstood. Such a waiver, it is argued by critics, would vitiate the credit-culture in the country: people would stop repaying loans henceforth in expectation of waivers on them. Since the UPA government had waived farm-loans a few years ago and now again there is a demand for a farm-loan waiver, peasants, they contend, are getting into a habit of not paying loans and demanding periodic waivers instead. Somebody, it is further added, has to bear the burden of the loan after all; and if the peasants…

The Economy Under Modi Prabhat Patnaik

The Modi government’s record in tacitly supporting the actions of  a bunch of vigilante thugs who have been terrorizing the country, especially the Muslims and the dalits, in the guise of gaurakshaks, or opponents of love jihad, or “nationalists”, has been so outrageous that it has grabbed all the critical attention. In the process the government’s abysmal failures in other spheres has gone virtually unnoticed. One such sphere is the economy whose dismal state is sought to be camouflaged by hyped-up figures of growth of the Gross Domestic Product (GDP). In fact, GDP figures these days engage one like an…