Tag: Indian economy

The Problem of Economic Growth – Part 2

I ended the previous part of this essay with:

The one factor that motivates the vast majority of people is self-interest. Self-interest is not a pathology because it’s a normal and unalterable aspect of human nature. It’s not a bug in human nature but is actually a feature. Indeed, self-interest broadly construed — enlightened self-interest — is what accounts for the advancement of civilization itself. People work hard to better the circumstances of themselves and those they care about, and in doing so advance the greater good even without intending to. This had been recognized two and a half centuries ago by Adam Smith and others.

Moving on —
Continue reading “The Problem of Economic Growth – Part 2”

The Problem of Economic Growth – Part 1

The economic growth of India since 1947 has been disappointingly low. Many countries—such as Hong Kong, South Korea, China—starting with comparable low levels of per capita GDP as India in the 1950s have over the last 75 years or so made phenomenal economic progress. Broadly speaking, those countries escaped poverty primarily because their political leaders were able to formulate and implement policies that promoted growth. In contrast to them, India stagnated. Continue reading “The Problem of Economic Growth – Part 1”

Quote: Robert Lucas asks an Important Question about India

Robert Lucas Jr, Nobel laureate pondered India’s lack of economic prosperity and asked, “Is there some action a government of India could take that would lead the Indian economy to grow . . . ? If so, what exactly? If not, what is it about the “nature of India” that makes it so? The consequences for human welfare involved in questions like these are simply staggering: once one starts to think about them, it is hard to think about anything else.”

Source: On the Mechanics of Economic Development. Journal of Monetary Economics. July 1988. Read more at the Library of Economics and Liberty.