Like any
other dimensions for election 2014,Economist is also as deeply divided and are taking extreme
positions.The two
major schools of thoughts emerged and deeply divided are from Amarthya Sen
and Jagadish Bhagavathi,They had
written and dissected the “Gujarat Economic model” in great detail.
On a
broader prospective Bahawathi emphasis for more “Growth” and believe this will
eventually tickle down to various weaker sessions and will more or less
automatically follow.While Sen
believes more important is distribution and empowerment of the “Weekest”, so
that with there contribution the economy will grow.One
emphasis on the need for creating more resources for re-distribution and other
one emphasis for distribution of the current resources to create more
resources.
Clearly a
Chicken-Egg problem with out clear answers, the middle line is what everybody
agrees so that it is equally important to create resources and also effectively distribute it to poor.
If you look
back, the Vajpayee led NDA focused only on first and the UPA II continue the
second approach even after the tipping point.Getting in
to growth track is relatively easy with right policies but to fixing the
distribution mechanism will need real administrative excellence.
What need
to be distributed? Is it direct cash or is it subsidized food and fuel or is it
cash for job which doesn’t create value.Economist
agrees it has to be spending on Education, Health and Energy. But will any of
that is effective in bridging rich-poor gap in India?
Coming
back, Congress is clearly put more emphasis on the redistribution but without
fixing the effectivness of the channel. Hence even if Sen was right, the tickle up effect didn't
happen for Indian economy.
Only the agents benefited and most of the impact was in shadow economy rather than
the real one. The flagship “AADHAAR” to fix the distribution issue is
still a non starter.
AAP lone
focus is fixing this channel of distribution and fights against corruption with whatever
methods seem possible.They don’t
have any policies or doesn’t seem to have one to fix the already emptied
coffers to even continue most of the Social Security schemes dolled out by UPA.
BJP, even
though haven’t come up with a clear road map, the market see Narendra Modi the
right choice to fix the growth issue.He hasn't
opened his cards on the distribution question but time and again emphasis to
fix the channel issue using more transparency and with the help of technology.
I don’t
want to talk about any regional parties economic policies as there is nothing
remarkable even from the Left.
Clearly on
the economic front,BJP is the clear front runner from the available choices, AAPs focus on fixing the weakest link in the chain to fix the economy and thus
rank second and Congress with his focus only on legislating more
social schemes perform badly in this subject.
It is no
more “Good economy, Bad politics” in India.
Really
appreciate any comments if any are restricted to economic policy.
1 comment:
Like any other dimensions for election 2014,Economist is also as deeply divided and are taking extreme positions.The two major schools of thoughts emerged and deeply divided are from Amarthya Sen and Jagadish Bhagavathi,They had written and dissected the “Gujarat Economic model” in great detail.
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