Archive for July 14th, 2008

Improving India’s social indicators

July 14, 2008

I had pointed to a GS report that gives a list of 10 reforms for Indian economy. In that post I compared the 10 reforms with the previously released  list of reforms (Mck report and Washington Consensus). The problem with these reports is that India has achieved a growth are without any of the reforms being implemented. GS report is a new such list and it will be interesting to see how India fares.

In today’s Mint, Nirvikar Singh (professor University of California, Santa Cruz) after reviewing GS report offers a shorter list to 5 points (NS 2008):

  • Make it easier for entrepreneurs to start, grow and wind up businesses
  • Restructure the civil service
  • Decentralize effectively
  • Pay real attention to health and nutrition
  • Educate everyone

So, he does away with usual suggested reforms like fiscal policy, mon pol, fin mkts, trade, environment etc. All these GS/McK suggestions are ideal but have so many sub-reforms and criterias/deliverables.   

Instead NS 2008 is calling for reforms in areas which have a direct impact on people’s lives. Things like education, health are so important but continue to be ignored. Simplifying business procedures will be very helpful as everything centres around business. We lag behind by miles looking at Doing Business Surveys (Though  DB methodology is being criticised, it is still useful to understand the various business practices)

I have always thought if India has to move forward we need a dramatic change in the way public sector (civil services) functions. The public sector needs a overhaul of systems, incentives.  Whether we like it or not, everything can’t be delivered using private sector. 

Private sector will come but it needs profits. The best example is education. There are many private sector colleges offering post-graduation courses but standards are abysmal. With very little support from the industry, the graduates hardly get any worthwhile jobs. As a result, the rush for govt. sponsored institutes continues. People do give examples of ISB but it is just one of its kind and is backed by (However, some people have begun to question ISB’s credentials as it hardly has any permanent faculty).

Assorted LInks

July 14, 2008

1. JRV says it is too early to say whether India can avoid the sub-prime crisis

2. Mankiw points to pessimism in US

3. Rodrik says we need a new Keynes

4. Take the Lusardi financial literacy test

5. DB Blog points a new paper analysing entry barriers and growth

6. Econbrowser ponders over Fannie Mae and Freddie Mac mess


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