Poll: Have you studied economics formally?

Incentives for Better Policies

This year, 2009 CE, marks the 200th birth anniversary of Charles Darwin (1809 – 1882), and the 150th anniversary of the publication of his book, On the Origin of Species by Means of Natural Selection, or The Preservation of Favoured Races in the Struggle for Life (1859). Contrary to what one may suppose, the phrase “survival of the fittest” does not occur in that book. It was Herbert Spencer (1820 -1903), who coined it in his book Principles of Biology, (1864).[1]

Spencer warned that “the ultimate result of shielding men from the effects of folly is to fill the world with fools.” That observation holds with special force in the context of the misgovernment of India. If the policy makers (the bureaucrats and politicians) are shielded from the ill-effects of their policies, they have little incentive to act prudently. Eventually, as the stock of bad policies keep building up, the country ends up in ruin. We have to remember that in the main, the success or failure of an economy is solely determined by the quality of its public policies.
Continue reading