Demonetisation Decoded: A critique of India’s currency experiment

“Demonetisation Decoded: A critique of India’s currency experiment”, written by Jayati Ghosh, C.P. Chandrasekhar and Prabhat Patnaik and published by Routledge India, is an important book that provides a quick and concise explanation of the goals, implications, initial effects and the political economy of the major demonetisation move of the Indian government, that involved de-recognition of over 86 per cent of the value of Indian currency in circulation in one stroke.

The Demonetization Fiasco Prabhat Patnaik

The demonetization of 86 percent of the currency of the country, a virtually unprecedented  measure anywhere in the world, has brought immense hardship to the working people of the country, and will damage their living standards permanently (since the Modi government plans not to replace the entire value of the demonetized notes by printing new ones). Many however believed that it was a step being taken for the greater social good, for achieving certain important social goals. Three of these goals were mentioned by the government from time to time: to attack black money, to replace counterfeit notes, and to…

Barbara Harriss-White on Demonetisation An interview with Madras Courier

Part 1 Barbara Harriss-White is an Emeritus Professor at the University of Oxford, with decades of experience studying India’s vast informal economy. It was this economy that was most hit by the move to demonetize higher denominations of currency taken on November 8. She answers a series of questions on the noteban with Madras Courier – painting a comprehensive picture of what demonetization has done to democracy, the 'black economy', corruption, agriculture, Introduction by Barbara I have been following notebandi from Europe (where the media are paying little attention) and I’m not watching Indian TV. So my experience isn’t first-hand, and my answers are…

The Utter Failure of Demonetization: The RBI says so even as it says not Surajit Mazumdar

From the figure of the value of fresh banknotes issued by banks by 19 December, it can be concluded that we are still very far away from the full replacement of the cash withdrawn from circulation and the severe cash shortage is going to continue well beyond 30 December. Utter_Failure (Download the full text in PDF format)

Supreme Court should Frame an Eleventh Question on Demonetisation Prasenjit Bose and Zico Dasgupta

Whether the demonetisation scheme declared through the November 8 notification qualifies as a fiscal or economic policy is a vital question that merits the attention of the Supreme Court. SC_Questions_Demonetisation (Download the full text in PDF format) (This article first appeared in www.dailyo.in)

Money and the Social Contract in India Jayati Ghosh

The social contract between a state and its citizens is a complex thing. Philosophers of the European “Enlightenment” saw it as the basis on which society is organised so as to ensure the mutual protection and welfare of its members. It is therefore the implicit social arrangement whereby citizens give up some of their rights and freedoms to the state or a similar authority, in return for some degree of order and stability that would effectively ensure the protection of their remaining rights and freedoms. In very unequal societies, the voluntary nature of such a social contract is not particularly…

Demonetization as a Means of Fighting “Black Money” Prabhat Patnaik

So many lies are being spread by the government which is currently busy wrecking the Indian economy in the manner of a bull in a china shop, so many spurious economic arguments are being trotted out by it, that one has to be extremely vigilant not to be swept away by this tide of unreason. In the current article, and the two subsequent ones to follow, I propose to examine some of the more persistent assertions that are being made by government spokesmen. The most persistent assertion of course is that demonetization is a measure against “black money”. In an…

Demonetisation: All pain for the majority C. P. Chandrasekhar

At the time of writing, chaos continues to prevail at bank branches and ATMs across India, reflecting the larger truth that the government has for no sensible reason frozen a major part of India’s payments and settlements system. The government did this by declaring, for reasons wrong and indefensible, that currency notes of Rs. 500 and Rs. 1000 denomination which accounted for more than 85 per cent of the value of notes in circulation (and around 25 per cent in terms of sheer numbers) would not be legal tender within four hours of a dramatic speech by the Prime Minister…

Demonetization and its Discontents Arjun Jayadev

You know it is trouble when the metaphor that is said to get describe your policy is backwards from the very get-go.  The demonetization decree was hailed at the outset by a breathless and chest-thumping media to be a “surgical strike’’ against black money.  But a ‘surgical strike’ is at least in theory precise and targeted- in this case presumably aimed at the ‘black’ part of ‘black money’. What has transpired instead is more akin to a carpet bombing- the very opposite sort of campaign- a widespread and indiscriminate operation without concern for collateral damage. The demonetization decree outlawed ‘money’…

Demonetisation was Primarily a Political Act Jayati Ghosh

Two weeks into the surprise announcement of by Prime Minister Modi of the demonetisation of “high value” notes, it is becoming more evident by the day that the primary purpose was political rather than economic, and that this political purpose was specifically directed towards ensuring the fortunes of the ruling party vis-à-vis its rivals. Nothing else can explain the abrupt nature of the announcement or the subsequent manner of its implementation, which has been so apparently insensitive to the specific needs of so much of India’s working population. While a lot of the criticism of this scheme has focussed on…

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