Friday, April 29, 2011

Playing with semantics

In the highly popular book '1984', citizens of Oceania speak a language called "Newspeak". The book is about dystopia and the language was devised to meet the idealogical needs of Ingsoc, or English Socialism. The purpose of this language was to prevent free thought.Radical?
Not really because we see it happening around us today. In his book 'The economics of Innocent Fraud' noted economist and diplomat J.K.Galbriath points out in the chapter 'Renaming the system' how we have supplanted words to make certain systems more palatable to the general public. The most startling example is of course the substitution of the word "capitalism" by the word "Free Market". The word "free" is so positive that anyone will tend to believe that it is the best economic system in place and that any role of the state is undesirable and harmful.
As I think on similar lines, I see that the word "economic growth" is now used sparingly and is replaced "inclusive growth". Similarly, the word microfinance is hardly used. Financial inclusion is the buzz word among bankers and policy makers.
All in all, George Orwell was indeed someone who had good predicting ability!

Thursday, April 28, 2011

IRMA Convocation-Photos and some words

I finally convocated from the Institute of Rural Management Anand (IRMA). It was a wonderful experience to receive the angavastram and the degree from Y.K.Alagh and Vice President of India respectively.
What was even more exciting was the fact that I was on stage (like all my batchmates) and stalwarts including Prof. Sriram, Dr. Amrita Patel (Chairperson, NDDB), Rural Development Secretary of Gujarat Govt., Apurva Oza , CEO of AKRSP (I) and Y.V.Reddy, Former RBI governor were in the audience applauding the entire batch. A heady feeling for sure!!!!

Saturday, April 23, 2011

Jean Dreze on Basu's idea:A more nuanced view

Unlike Sainath who wrote a very shallow article against Basu's idea about harassment bribes, economist John Dreze, a member of the National Advisory Council has a trenchant article against the idea published in the Indian Express.

Friday, April 22, 2011

P Sainath on Kaushik Basu's idea

My earlier post on the harassment bribes idea by Kaushik Basu had a comment deriding the idea.
P.Sainath, the rural affairs editor of Hindu has criticized the entire idea in a column he wrote for the Hindu.
Read the comments that readers have left below that article. And you understand why P Sainath is really no more than a journalist who likes to whip up sentiments and emotions and nothing more ala the television anchors on news channels.

Thursday, April 21, 2011

How fast food chains enhance decision making ability

In emerging economies, fast food chains like Mcdonalds, Dominos Pizza,et al have come under attack for destroying local food habits and americanisation of culture. In fact, there is a slow food movement against the fast food onslaught which has been started in Europe. Of course in India, all these chains had to adapt their menus to meet the Indian taste bud requirements.
Even though they have a limited menu, the choices they give in terms of product bundling (Ever faced with the "Sir, would you like a soft drink?" and you answer yes and then he asks you for the brand,the size(small, medium ,large) and then he does the same for your fries, sauces , etc?) is enormous.
In fact, this seemingly endless choice even made the great Prof. Yunus fear American restaurants when he was a Fulbright Scholar. He says in his book 'Banker to the Poor'(pp43) on how he was given so many choices when he had ordered for eggs at a restaurant.
The most funny rant of such endless choice comes from the movie "You got Mail" starring Meg Ryan and Tom Hanks. Joe Fox played by Tom Hanks has this take on Starbucks in the movie
The whole purpose of places like Starbucks is for people with no decision-making ability whatsoever to make six decisions just to buy one cup of coffee. Short, tall, light, dark, caf, decaf, low-fat, non-fat, etc. So people who don't know what the hell they're doing or who on earth they are can, for only $2.95, get not just a cup of coffee but an absolutely defining sense of self: Tall. Decaf. Cappuccino.

(Disclaimer: The post is on a lighter vein. Except watching "Food Inc" and newspaper articles which cover such protests I really am not well informed on such protests.)

Monday, April 18, 2011

Harassment Bribes: Kaushik Basu's new idea

The 2G scam and the Anna Hazare movement has galvanised the media and large sections of the population to lash out at the powers that be against corruption.However, all I could hear was criticism (even at the jan lok pal bill) and no constructive argument on how to curb corruption. Until of course, Kaushik Basu's trenchant working paper titled "Why for a class of bribes, the Act of Giving a bribe should be treated as legal" came out on the finance ministry's website
Its a very well written paper. He argues that bribe givers who are forced to give bribes to receive legal entitlements should not be treated as criminals. Currently the law does not distinguish between bribe giver and bribe taker. Basu says that incidence of such bribes (he calls them "harassment bribes") will go down once the bribe giver is given legal immunity. Under this scenario, since the interests of the bribe giver and the bribe taker are orthogonal, the bribe giver will want to report such instances of harassment bribes because he will no longer be considered as abetting the act of bribery and also he will receive the amount he gave to the bribe taker. In other words, the comfort zone that currently exists between the two parties will not exist under the proposed change.
Of course, he states that in case of non-harassment bribes, the bribe giver should not have legal immunity but the punishment meted out to the bribe taker should be substantially higher.
Of course, there are caveats in place. Basu says that giving such immunity will not lead to complete disappearance of bribes in our society.Other important steps like use of e-technology to minimise the interface between the public servant and the citizen would be helpful in curbing corruption. Also, it is only when we build up values of honesty and integrity in society will be there a great reduction in corruption. Of course, Basu does contend that economics as a subject considers human beings as endlessly self-seeking.But he does provide evidence that we are not always endlessly self-seeking and that market economies (which we are trying to build) will not be efficient unless human beings are endowed with a minimal amount of integrity and pro-sociality.

(For those interested in reading the full working paper, here is the link)

Saturday, April 16, 2011

Har Galli main Hoga ek IIM

IIMs are part of the great Indian middle class (with the hike in fees, maybe the upper middle class) dream. Since only few of us can manage to get into it, there have been several people who have started their own Institutes and made a killing!
Since the brains sitting in Delhi believe growth is the panacea for all ills, they have gone about setting up IIMs everywhere. Ranchi, Shillong, Rohtak, Trichy (and I used to think Anand is remote), etc are where these IIMs have been set up or will be set up.
I always thought setting up an IIM is a tough task! In fact, I thought it was a romantic task when you set up an educational institution as big as an IIM.
The romanticism is captured in what Ravi J Mathai, founding Director of IIMA and founding member of IRMA has said "Building of an Educational Institution is an act of Faith, faith in your beliefs, in your vision, in those whom you work and in their accomplishments
Wonder any of the founding directors of current IIMs will feel the same way

Tuesday, April 12, 2011

Speeches by the top guys at RBI

The RBI has a "speeches" link on its website which hosts the speeches given by RBI governor and the deputy governors. The speeches surely help in understanding various aspects of finance and economic concepts including topics like inflation, inclusive growth, etc. The most interesting one was by the RBI Governor where he spoke on the dilemma of Central Banker's communication strategy to the general public.

Friday, April 1, 2011

Dr V.Kurien

It's surprising that in these two years I have hardly mentioned Dr. V. Kurien in my blog postings.I have had the good fortune of interacting with him once. Though his health has deteriorated he was very affectionate and was more than happy to answer our questions and submit to our demands of numerous photographs and autographs.
At IRMA, Dr. Kurien finds mention only during the induction week when the Amul Story is screened. Of course, some courses like Management of co-operatives and Rural Development Interventions include articles which have been written by the great man.
It is a sad fact that most people recollect his unceremonious exit from IRMA rather than the efforts that he put into this great institute.His exit of course was always mired in secrecy. Until Prof. KVR explained the circumstances in which he was forced to leave IRMA.
There are several stories about the great man. I cannot substantiate how much of it is true and how much of it has been made up. The story of how when a faculty member repeated verbatim the mission of IRMA,while disagreeing to a decision of Dr. Kurien was told by the great man " I am the mission of IRMA, so please sit down" is always told with great amusement.He deliberately made the paths to our hostel blocks long and winding instead of straight and short to make us realise that in life there are not shortcuts to success. His driver recounted how he used to tap the pillars of IRMA while it was being constructed to check if the correct proportion of materials was used.
Today as I leave IRMA, there is an overwhelming sense of sadness. This only after living here for two years. I can only imagine what the great man must have gone through when he was asked to leave after having built and nurtured this institution for 25 years!!
Like all other IRMAns, I too have a great sense of gratitude towards the milkman of India.I thank him for making me part of this great history which he and Tribhovandas Patel scripted! Thank you Dadu! And I wish you well!