Category: Uncategorized

I’d like to explore a few important concepts like government, constitutions, democracy, etc. They are embedded in the fabric of Indian society. Taking a clear-eyed view of their genesis, nature, function, modes of failure, and implementation can be intellectually rewarding but more importantly it can help in creating the good society. I’ll start with something seemingly unrelated — clubs.[1]

Consider an average workplace lunch club. We will call it the “Wednesday Lunch Club.” A bunch of coworkers[2] — five in our club — go out to lunch every Wednesday. Where? The restaurant is decided by a simple majority rule vote. If three out of the five members agree on Chinese food, then a Chinese restaurant it is that Wednesday. The two that wanted Indian food have to go along with the group decision. It’s not that they hate Chinese food but on that particular day they preferred Indian food. So they incurred a loss in terms of not being as satisfied with lunch as they would have been if the WLC had gone for Indian food.

Models

That’s a simple story. But if one examines it carefully, in detail and in very small steps, it can be instructive. It’s a very small elephant but it’s still significant. Slowly walking around the small elephant, examining its features carefully, making sure we are on firm ground each step of the process, and integrating different bits of what we learn gives us an understanding of the big elephants we encounter in real life. The small elephant is a model. Continue reading “Clubs and other Collectives (and the Welsh Incident)”

In response to my piece “Censorship on the Internet“, a friend from Mumbai emailed me two questions: “How should we look at issues like pornography. Is it okay to let people say/show what they want to and let children and other vulnerable groups see/listen to all that ?” and “How can India move in the direction of First amendment?”

Let’s take the issue of pornography. Different societies have different standards about what’s acceptable in all aspects of living — what to eat, how to dress, how to worship, sing, dance, make music, make art, etc. These evolve with time and technology. Whether we like it or not, the moral code too evolves.

What’s considered obscene also differs among societies, and the standards change with time in the same society. There was a time, for example, when the sentence “Frankly, my dear, I don’t give a damn” was considered too vulgar to be uttered in a movie. (Gone with the Wind, 1939.) Now you can say WTF to that and no one would bat an eyelid. Continue reading “Censorship on the Internet — Revisited”

To a previous piece , “The End of Poverty“, my friend Indradeep added a few thoughtful and thought-provoking comments. I take him seriously since he’s a fellow member of my tribe (namely, economists). In the following, I will do my best to address the points that he has raised. But first, here’s what I wrote in summary in my piece:

Technology is advancing at an exponential pace. Therefore the cost of energy will continue to drop. Therefore the cost of production of stuff will monotonically decrease, until a point that it will be practically close to zero. Therefore all the basics of life will be available for consumption at zero price. Therefore extreme poverty will be solved. This will happen in about 15 years.

I reproduce Indradeep’s comment here for reference:

Hard to argue with the idea that technology will reduce cost to near-zero levels. But the rest of it borders on wishful thinking. Especially, the expectation that some system of distribution will magically appear, sounds almost as sanguine as the familiar and now roundly discredited argument advanced by free-market fanatics that free trade is surely beneficial and the matter of how the winners compensate the losers is only a minor wrinkle that we do not need to worry about. Political economy, voice, agency – these things are nowhere in the picture. Does not a system of representation of voice have to precede the appearance of a system of distribution? If the rich have no intrinsic interest in alleviating poverty, how will that first system come into existence?

Let’s examine the “now roundly discredited argument advanced by free-market fanatics that free trade is surely beneficial”. Continue reading “The End of Poverty — Revisited”

In the context of exponential technological growth (a topic that I explored in the piece “The End of Poverty“), Akshar asked in his comment, “Don’t you think the gap between a poor person in India and a poor person in say USA would only increase ?”

Yes, I think that the gap will only increase with time. But that is just part of a broader trend of increasing inequality in numerous dimensions — within and between nations. In technical terms, the Gini coefficients (a measure of inequality, where 1 means perfect inequality and 0 means perfect equality) will continually increase.  Continue reading “The Growth of Inequality”

This is an optimistic piece — a rarity for sure around this blog. Here I claim that in 15 years or so, extreme poverty which afflicts around one billion people, mainly in the so-called third world, will be eradicated. That problem has plagued mankind since the beginning but the end is in sight.

Technology

Global extreme poverty will be eliminated as a side-effect of technological advances, primarily made by people who probably neither care about poverty nor do they intend to solve that problem. Which is good news for India. India has the largest number of people suffering extreme poverty in the world. Around half of the billion extremely poor people of the world live in India.

There are two kinds of problems. There are hard problems and there are impossible to solve problems. Given time, with advances in knowledge, all hard problems will be solved. Poverty is a hard problem but not an impossible problem since in many parts of the world it has been solved for all practical purposes. The critically important key to eradicating poverty is knowledge.

Knowledge

Knowledge is what economists call a “public good.” Once produced, knowledge can be repeatedly used without diminishing the available stock. It is “non-rival” in consumption. Technology increases monotonically because of the accumulation of knowledge. And technology (which is essentially knowledge of how to do something) developed somewhere gets adopted in the rest of the world with surprising rapidity. It is very cheap to use once developed.

Consider the cell phone, internet and computer technologies that were developed in the Western economies (they are called developed economies partly because they developed technology) but those advances spread to every part of the globe. Just like the computation and communications technologies, it will be people in rich countries who will develop the technology to eliminate poverty in poor countries, albeit not by design nor intent.

That means India’s dire poverty will be solved not by Indians — least of all by the insanely inept, criminally corrupt government of India which is arguably the fountainhead of India’s poverty — but by others. I note in passing that India’s telecommunications problem was created by the government but it was solved using foreign technology.

In the following I conjecture how the end of poverty will happen.  Continue reading “The End of Poverty”

Well, what do you know — it’s Christmas!

And in the spirit of the holiday, watch Jon Stewart’s hilarious take on the “war on Christmas”.

Here’s what the video above is about: Continue reading “The High Definition Earth Viewing (HDEV)”

One of the benefits of living in a security-state aka mass surveillance state or Big Brother State is that one is constantly under the threat of being put under the microscope and dissected. Benefit? Nope. For those who love freedom, mass surveillance is a cancerous evil that should be resisted.

I came across a May 2015 article You’re a Criminal in a Mass Surveillance World – How to Not Get Caught by David Montgomery. It’s immensely long. But its length is absolutely required to get across the important issues it deals with — how to live in a society where mass surveillance is the norm. I am extracting a bit from that article. A small step toward freedom from Big Brother is to get a secure email channel. Here’s how.  Continue reading “Encrypted Email to Defeat Mass Surveillance”

Leaders Emerge

Leadership is endogenous to the system which selects them. Leaders emerge from within the system and gain legitimacy through the acceptance of the people within the system. Thus there are two components: the people and the system. Both are causally related to some extent but can be considered separate for analysis.

​Bad leadership cannot emerge out of a good system with good people in it. Conversely, good leadership cannot emerge from a bad system and bad people.

That leaves two other scenarios: good people, bad system; and bad people, good system. My conjecture is that in both of those, bad leadership is very likely to happen.  Continue reading “Why India Needs a Third Party”

The lack of basic competence among those who hold political power is very likely one of the primary reasons that some nations suffer needless poverty. The recent cabinet reshuffle (is it a deck of cards in a game of chance that it needs periodic reshuffling, I wonder) in the Modi government prompted this line of thought.

Continue reading “The Primary Moral Hazard”