Manufacturing Wealth: The Economics of Urbanization

That’s the title of the course I am conducting at the Indian School of Business, Hyderabad. It is a small class of about 15 students. It’s a half-credit elective in the final term of the year.

We have had two lectures so far. I am having fun — which is another way of saying that I am learning quite a bit. I think I will share some of what I have learned on this blog in the next few weeks.
Continue reading

LK Advani’s speech to the FICCI

If you want to build a ship, don’t drum up people together to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea,” advised Antoine de Saint-Exupery.

Does makes sense, doesn’t it? Motivating the task is the real job of the leader, not messing around with petty details.
Continue reading

Data on Criminals in the Indian Parliament

Anyone familiar with the disastrous state of India should not be overly surprised to learn that the Indian parliament has an overwhelmingly greater percentage of criminals than the general population. How effectively a nation functions and how successful it is depends on its leaders who make public policy and thus critically determine the outcome. India’s failure to develop and achieve its potential is proof positive that its leadership is lacking.

Underdevelopment, poverty, and all other ills that plague India are an unavoidable consequence of poor public policies and choices.
Continue reading

Begging for a World Class University

Consider this scenario. Someone you know imprisons his grown up children and does not allow them to go out and do jobs that they are fully capable of doing. He also locks up his productive assets and prevents his children from using them. Then he goes around begging his neighbors for help with feeding his family as he does not have any income. The words that spring to mind upon considering this man’s behavior are words like contemptible, immoral, stupid, pathetic, pitiable, and sad.
Continue reading

India Spends $13,000,000,000 on Education Abroad

That’s what a report in the Hindustan Times claims: US $13 billion each year. Figures such as these are unbelievable but I suppose someone must have done the numbers. In any case, I had estimated that number to be around $10 billion a few years ago.

Let’s pause for a moment and figure. $13 billion every year. Or in the last 10 years, about $100 billion. Imagine what you could buy for that money. How about 100 colleges with first class infrastructure with housing, classrooms, labs? Each year India could have an additional capacity for 10,000 college students and in 10 years you could have 100,000 additional capacity. Imagine the multiplier effect of that spending — in construction, in salaries to teaching and non-teaching staff. Imagine the boost to the industry from creating human capital. The imagination boggles at the sheer waste.

Imagine how much infrastructure you could build for $100 billion.

One of the principal lessons one learns as one studies economic development is that success or failure depends largely on the set of economic policies that govern the economy. India, for instance, is poor and economically a failure because its economic policies are extremely brain-dead. Of course one can explain why these brain-dead economic policies exist. We will not visit that now. Here I would only mention that the policy on education is the most brain-dead and that educational policy is largely to blame for why India is poor today, and if the policy is not changed, then it will certainly doom India in the future.
Continue reading

On Aurangzeb

I have it on good authority that Satyameva Jayate is India’s national motto. The English translation of the Sanskrit is “Truth Alone Prevails.” Is that claim itself true? Can it really prevail in a land where some people are afraid to speak what they perceive to be the truth because some others confront that expression with violence?

Thomas Jefferson claimed over 200 years ago that “it is error alone that needs the support of government. Truth can stand by itself.” I agree only partly. I don’t think that without courageous people truth has a chance. Truth, in the abstract, of course exists. But for it to triumph, surely it has to be expressed by humans and be part of the mental makeup of at least one human being. The world is spherical is a truth in the abstract. But at some point in the history of human civilization it became a concrete truth. But it required courage to express a truth that in some parts of the world was considered against god and morality.

Truth would have a hard time prevailing in a nation of people cowed down from fear and threat of violence. A recent example of violence shutting out an attempt at finding the truth occurred in Chennai. A bunch of people shut down an exhibition which revealed Aurangzeb to be a tyrant. The police were also involved in the vandalism. The state was involved in suppressing the expression of a viewpoint that some considered unpalatable. Most of the newspapers did not report this.

Isn’t it true that India’s motto basically pokes fun at India’s public actions?

Link: Details of what happened and Kanchan Gupta’s opinion piece.

[Follow up post: B Raman on “Aurangzebs of Today.”]

Your Vote for My Money

A democracy cannot exist as a permanent form of government. It can only exist until a majority of voters discover that they can vote themselves largess out of the public treasury.
— Alexander Tytler

Some numbers are well beyond human comprehension. We can talk glibly about millions and billions of this or that but we cannot intuitive grasp what they actually mean. Evolution has equipped us with fine brains but those brains never needed to deal with thousands — leave alone millions — of anything. So we have to do some mental gymnastics to get a fleeting glimpse of what very large numbers represent.
Continue reading

Reality Disconnect

There appears to be a thriving cottage industry which is primarily engaged in churning out shallow pieces of journalistic garbage. The pieces detail a particular person’s or family’s struggles and then juxtapose it in some dramatic way with perceived overall prosperity. The implicit argument is that there is an immense injustice being perpetrated against the poor, that it is all the fault of those who are not poor, and that the poor have absolutely no responsibility for the miserable state of affairs. These articles reveal a lot without intending to. They plainly state that the author did not quite learn the lesson that stared them in the face when they were investigating the story.
Continue reading

Why is India poor?

Don’t read Tavleen Singh’s column “Educating the Education Minister” in the Indian Express today if you wish to continue being puzzled by the question why India is poor.

Basic decency and propriety prevents me from suggesting what should be done to the Indian minister she writes about. Shame on you, Dr Manmohan Singh. Please, in the name of everything decent and human, resign.