Would the economy be better off without MBA students?

A nice debate on economist which just got concluded. 51% voted in favor saying economy would be better off without MBAs..

The debaters are:

• For the motion: Henry Mintzberg  Cleghorn Professor of Management Studies, McGill University’s Desautels Faculty of Management
• Against the Motion:Paul Danos  Dean, Tuck School of Business, Dartmouth College

There are independent statements by two others both for and against the motion.

Till now we were discussing the usefulness of economics and economists..now MBAs are also caught in the fire…Another victim of the crisis…

 

What’s the use of economics? (voxeu debate)

This is the title of a recent debate hosted at voxeu.org.

First contribution comes from Diane Coyle of Enlightenment Economics. She looks at the issue of teaching econ in schools.

She says econs need introspection post-crisis:

Rethinking How We Teach Economics…

A superb debate in NYT on the topic on how we should be teaching economics after the crisis.

While a protest of an introductory economics classat Harvard University last semester seemed inspired more by the Occupy movement than by academic criticism, it raised questions about how the teaching of economics should change in light of the financial crisis. Indeed, what have we learned in the last five years that should be imparted upon future generations of economists?

Mona Chalabi, a 2011 graduate of Sciences Po in Paris and the author of “The Latest Financial Crisis: International Relations Goes Bankrupt,”suggested this forum.

There are contributions from Taleb, Blinder, Chinn etc. A superb read.

I really liked this from Chalabi:

Is the modern central bank in need of reform?

Gulzar points to a discussion hosted by Economist on the topic.

Needless to say the economists are divided on role of central banks. Some say it should focus on price stability alone and others say it has to be expanded…

Was the financial crisis avoidable?

Economists debate this issue in this NYT forum.

Should we limit size of cities?

Economist is running a debate on this topic.

This house believes that restricting the growth of cities will improve quality of life.

Adam Roberts , South Asia chief of Economist is the  moderator. Chetan Vaidya, director of the National Institute of Urban Affairs in India, opposes the motion. Paul James, director of the Global Cities Institute at RMIT University in Australia supports the motion.

Roberts says cities have increased manifold and quality of life is suffering:

Do economists need a code of conduct?

I had posted about economists debating having a code of conduct at 2011 AEA meeting.

Economist brings up the debate and several economists write their views. Needless to say, views are mixed.

How has the crisis changed the teaching of economics?

There is an excellent discussion on Economist on this topic.

Number of economists chip in - Hal Varian, Tyler Cowen, Alberto Alesina, Michael Bordo etc. Two broad ideas emerge which need to be included in economics – One economic history and two basic concepts of finance.

Economists predicting housing market crash: Optimists vs Pessimists vs Agnosts

This is a must read paper from Boston Fed economists. If there is one paper you have to pick to understand US housing market crash. This is it. It summarises the debate which economists had before the crisis. Some economists said there is a bubble, some said there isn’t and others just presented facts without taking a view.

The global revival of industrial policy

The evergreen topic again. Economist has a nice discussion on the topic. It looks at recent instances which show a revival. In the end points to lessons:

We are all responsible for India’s Olympics woes

I am pretty late on this topic and it has been discussed quite a bit already (see this from Cowen). It is the hot topic- why do we do so poorly in Olympics despite having such a vast pool of resources? The usual blame comes on poor facilities, lack of funding, interventions etc.  I don’t really see it in this way. I agree these are factors but not the only ones. Infact we as a nation are responsible for this state of sports in the country.

Actually, this is a quadrennial question visited every 4 years at time of Olympics and forgotten after the event. We as a nation are obsessed only with one sport- Cricket and that is where it ends. The same media which blames poor facilities gives every other sport a very poor coverage. How many would know the captain of Indian Hockey Team (just a reminder Hockey is our national sport)? How many know India won the Asian Football Confederation cup? Media is surely to be blamed as one could see the interest in boxing, shooting and wrestling just rise to esoteric levels after the recent Indian performances. But I am sure it will all move to cricket after Olympics (despite such poor recent performances).

If state does not help, what prevents the private sector from supporting the players? As this Mint article shows Mittal Foundation and  joint effort by former All-England badminton champion Prakash Padukone and billiards great Geet Sethi, helpoed things. Infact, both Abhinav Bindra and Akhil Kumar (the boxer who lost in Quarter Finals) were beneficiaries as Mittal trust provides finances when both were fighting health problems. Indian industry has made rapid strides with record profits, acquisitions etc..surely they can help and finance a sport/sportsmen. But instead record money continues to flow in cricket. Let it flow in other sports as well. Before Indian Premier League, we had a Indian hockey league where similar club concept was made to make hockey popular. However, it didn’t receive the fanfare it deserved. It is irritating to see the corporate world line outside sportsmen houses after the medal wins. Why not before as well?

The players also need to understand they need to pull performances and then only private money, media, fans etc follow. However, what you get to see is disappointing performances and that too from favorites. No performance is repeated. Rajyavardhan Rathore got us silver in Athens which made shooting popular and we had maximum medal hopes in Beijing-2008. However, barring Bindra hardly anyone could even qualify for the final events. Likewise, Karnam Malleswari raised hopes in weightlifting when she won a bronze in Sydney 2000. But again because of poor performances later on, we hardly see anything happening. And surely these athletes would be looking at performances from countries where facilities are hardly going to be any better (Ethiopia etc). The Indian athletes should realise they are the chosen one to represent the country and should give it their best shot. One inspired performance is all it takes.

This is where China is really good. Looking at these Olympics, all their favorites have won and have infact broken records. They not only maintained their previous wins but have ensured they enter new fields like swimming etc. The athletes are not just physically superior but mentally as well. Imagine the pressure on them performing in front of their home crowd which has set such high standards. But still they don’t buckle and instead deliver. Looking at the recent India medals all have come (barring Vijendra at Boxing) when least attention was on them. Whenever the nation looked up to a medal performance, it was thorough disappointment.

How about the general public? Apart from watching the other sports, we need to push children in sports as well. You come across so many people who give up sports careers as there isn;t any hope if you are a sportsman.

The state of Indian sports is a chicken and egg situation. The players blame facilities/lack of funds for poor performance, private sector blames poor performance for lack of interest, public blames poor performance/media coverage etc and the circle simply goes on and on. It is time when we all act in it together. If I am asked,  private sector support surely should help make things better.

I hope Beijing 2008 provides the turning point.

Improving housing market practices via banks

In his open letter to RBI Governor , V. Raghunathan (CEO, GMR Varalakshmi Foundation) starts like this:

Dear Dr Reddy, have you ever read—I mean really read— the contracts builders hand out to ordinary homebuyers to sign for a transaction worth lakhs and even crores?

People would know what is to follow next. He goes on to say the contract leaves the home buyers without any help whatsoever. He is completely at the mercy of the builder as the contract is lopsided. The builder charges a huge penalty if the buyer misses an installment on the due date but hardly any penalties are there if the builder misses his completion stages.

While the buyer will have to pay a penal interest of 18% per annum for a delay of even 15 days on his instalments to the builder, the builder has no such obligation for delaying the completion of the work by any length.

Then he points there is no say to enforce quality of construction promised. It all depends on the builder. All sellers say it is high quality stuff at time of sale but we all know how false these claims are. Other products don’t matter as much as a house. In a house most people put their lifetime savings (or are entitled to pay the bank for near life time) and there is no recourse. In Navi Mumbai for instance, whichever property you buy, it starts leaking in the first rain itself and you can’t do anything except spend more to fix it. 

The author then asks RBI Governor to use banking system to impose some standards in this industry:

Often, the agreements with the builder are linked to the loan contracts, so that the loan disbursals go directly to the builder. So it should be possible for banks providing the housing loan to require all payments from buyers to the builders to be made through an escrow account. The bank could also hold a limited power of attorney from the homebuyer (borrower) to ensure that the builders have met their obligations and once so satisfied, clears the escrow.

I must say it is a good thought. The practices in housing markets in India (particularly in metropolitan cities , where we have multi-storey apartment system) are so bad, that any help would be great. The Builder-Broker nexus is too strong and you feel duped all the time, but can’t do anything. Whether you take a house on rent or buy it ( See the economics of house-hunting in Mumbai), there are such huge transaction costs that you always feel burdened.

For instance, in Mumbai you have something called a “super built up” area which is roughly about 35%-40% of area. So, if the builder quotes 1000 sq ft area what you get is 600-650 sq ft area but you pay for the entire 1000 sq. ft. Super-built up includes area of terrace, balcony, parking, garden etc. and as this also involved development costs. the buyers have to pay for it collectively. But why 35-40% from all the buyers??  This was earlier called built up which was 15-20% but now has been extended to 35-40%. And worst of all, this has now been included for all flats. Even the old properties are selling at superbuilt up areas.  

Apart from this, Banks can also be very usefully used to do some rating of the builders. As of now, Banks just approve certain builders but there is no rating. You really do not know which builder is a good one. As a result, the apartment prices are near similar and depend on the area, not the quality of the builder. Some builders have developed a brand equity but they are very few in number.

The author also points to a problem which provides some food for thought for beh eco guys: 

And the most unfortunate thing is that most buyers do not (and others cannot) even read what they are signing on, thinking the process to be a mere formality.

This is also a big problem. The form is a mixture of legal and financial lingo and very few people have the speciality to understand both. The forms should be made simpler and shorter. But again this is a less of a problem than solving the above issues.

Housing is big problem in places like Mumbai and it is a very basic issue. If banks can help, it is most welcome. Moreover, research and debates are advocating that Central Banks need to look at asset prices (discussed here) and asking banks to monitor developments in housing markets might just be a good idea.

A request to India’s Ivy Leagues- show us some research

It is March and the media is rife with developments on the placement scenario in India’s elite Business Schools. The placement season has begun and news is filtering on the compensation packages received at the various schools. The news of who and which school has received the highest compensation package is doing the rounds.

I still don’t understand this placement mania in the media. One can understand a weekly column to cover the issue but we see a regular full page dedicated to the events. It is sad that the only way these elite colleges engage the media is on the placement prospects. Is that the only thing that these education temples have to offer?

The most important parameter for a good school is its quality of research and unfortunately, this is something we never get to read. Unlike the west, where the media profiles faculties and their research, all we get to hear from these schools is on placements.

An important way one can judge the quality of research is via peer reviews. The academia makes references to other people’s work in their research and more such references, better is the quality of the research. Though this practice has been abused lately but is still the best way to judge the quality of a research. It is actually surprising that after reading many a research papers (even on Indian economy), you hardly come across a reference that comes from these elite schools. Whenever one comes across an Indian name it is mostly from a foreign university.

There is a huge interest on Indian economy and some Universities have even set up India centers. So, the faculty can’t even blame “times” saying no one is interested in Indian economy/companies etc. The academia can’t even blame the media saying it isn’t interested in covering research. These days awe come across a lot of newspaper articles that explain the developments using research papers. Some newspapers even have dedicated columns profiling research but it mostly covers research done in Universities abroad. Infact, one leading economist who writes a column lamented on the same fact- lack of research in India.

Then there are other events that these schools organize – seminars, symposiums, conferences etc. to discuss various research papers on a particular topic. There is hardly any mention of the same in the media. All we get to read is about the cultural festivals and marketing events.

This is not to say that the faculties do not research but they need to use better ways to propagate their research. They should make efforts to use web and print media to inform people about the new research undertaken in these schools. It is very good if the faculty can get their research published in leading journals but discussing it with the public is be an equally good first step.

The elite schools may not realise but they have led to development of a very dangerous precedent. All the schools seem to be just focused on placements and not on the curriculum. The students also take up a course looking at the lucre and not understanding the suitability. The students should ask their respective schools what they can teach not how much salaries they can help them get.

It is a request that the elite schools take up this matter seriously and lead from the front. They should limit all these press releases on salaries and placements and instead channelise their energies on showcasing their research output. At the end, I wanted to point to an interesting trivia. The financial assistance for one the most profound idea in economics – The Market for Lemons written by George Akerlof – was given by Indian Statistical Institute. So, it is not that the Indian schools can’t do it, all they need is to re-focus.

Of Kidney Sales and Economics

I wrote a piece for Mint based on the developments in Gurgaon. In this I discuss how the kidney racket unfolded in India and the way the racketeers took advantage of loopholes in the law to trade in what is otherwise a banned activity.

However, I took the discussion further and added an economics perspective to it. Just a few days before the incident took place, I posted about a fantastic thought provoking paper from Alvin Roth where he discusses how there is repugnance with respect to selling kidneys and how that effects making a much needed market for the same. And then this incident happened.

There is a lot if discussion in media since Roth wrote this paper- NY, WSJ, Freokonomics Blog etc.

Is fear of floating same as fear of appreciation?

So far, it has been felt that developing countries have this fear of floating.

Emerging markets have underdeveloped financial systems and don’t have easy access to finance. Hence they borrow abroad and as a result the balance sheets are mostly dollarized. In case there is a crisis, the demand for domestic currency goes down, and it looses value. As a result,the value of liabilities increase and if currencies are allowed to float freely, the impact of crisis could be severe and hence the term “fear of floating”.

This fear came at the time of South East Asian crisis. If you note, the main fear then was depreciation of the currency.

However, what we see these days is the opposite – fear of appreciation. Most emerging markets have managed floating exchange rates and intervene in forex markets to keep their currencies undervalued. They don’t want their currencies to appreciate as it would harm their exports.

Hence we have fear to appreciate. This has been conveyed in an excellent paperby Eduardo Levy-Leyati and Federico Sturzenegger. I was actually surprised why didn’t it strike me before?

More generally, the incentives and implications to intervene in order to avoid an appreciation are radically different from those related to avoiding a depreciation: where the latter focus on short-run financial crises, the former is usually predicated on long-term economic growth. Similarly, the context conducive to one or the other differs: whereas fear of floating would tend to arise in times of financial turmoil, fear of appreciation will likely be triggered by economic bonanzas.At any rate, treating interventions in a symmetric way –in particular, attributing any intervention to fear of floating as has been previously the case in the literature– may lead to overstate the incidence of financial factors –more so in recent years when fear of appreciation appears to have prevailed.

Read the paper for further details.

It has another surprise finding.The normal belief is that undervalued currency should help exports to grow and hence aide growth. In  other words, the growth is export driven. The authors find that exports hardly contribute to the growth and the main channel of growth is that depreciated currency leads to higher savings which are channelised into investments and finally growth.

This study is worth replicating in the Indian context and see the results.

Similarities between cricket and subprime crisis

International Cricket Council’s decision to remove Steve Bucknor from the third test match at Perth has got a lot of criticism from the cricket experts and media. (All the developments after the Sydney Test Match are here; my view of the match is here).

The West Indies cricket board has raised objections over the move (as Bucknor is from WI) and so have number of players who call it a ‘bad precendent’. Their take is it has  set a bad example and teams might be using this example to remove umpires who have given wrong decisions in their future matches.

This situation got me thinking and I can see quite a bit of similarity between the recent financial crisis and “Sydney” crisis.

Even in the recent crisis Fed was in a dilemma; if it didn’t cut the rates it would have invited huge criticism from various sections on account of slowing down of economy and if it cut rates it would invite the same from moral hazard brigade.

Similarly, if ICC did not take a decision it would have invited criticism from supporters of Indian team and when it took the decision it drew flak on the move.

ICC took the decision on 2 broad counts: one to pacify the situation as India had threatened the boycott of the tour and two, India contributes most to cricket’s revenues. Obviously, second reason is not the one which ICC can state formally but it is a well-known fact.

Now as long as it is the first reason it is fine, but it is the second reason it is more worrisome. The purists would say that a team cannot be larger than the game and hence Indian team’s request should not have been adhered to.  Hence, it is a moral hazard in financial parlance.

I think the authorities have to share the blame for not acting fast enough. Like in the financial markets the authorities waited till all hell broke loose, similar is the case with cricket.

• India has always been uncomfortable with Steve Bucknor and he has given some horrendous decisions against India. ICC could have ensured that he is not umpiring in India’s matches. Prevention is better than cure.
• More than anything ICC has been ignoring the Aussie behavior for quite long. Bad behavior is bad by calling it “Aussie way of playing” you can’t pass it as good. This aussie stuff has been picked up by most teams and now any series is more popular for the behavior than cricket.  ICC should have taken some tough decisions earlier on. I was actually expecting a  far more worse thing than what happened at Sydney test like a full fledged brawl between the players etc. I hope we see some developments on this
• Umpiring standards are getting really bad as we move on. This is surprising given the increasing use and presence of technology. It is quite funny when you have an umpire say “not out” and TV screen at the stadium showing he was “out”. And there are many inconsistencies in their decisions. Sometimes, the third umpire is referred sometimes not. Sometimes the umpire gives out but the batsman is sent back on TV replay showing he wasn’t out and sometimes there is no action. Hightime for judicious mix of technology and humans. We can’t be inconsistent when stakes are so high. (Likewise the Central Banks should think beyond price stability otherwise each time we would see similar episodes)

In the end is it a case of Moral Hazard? I think yes. Like, financial markets never learn and keep coming out with fancy products (in the name of financial innovation) and end up asking for Fed’s help. Similarly, cricket teams might ask ICC to intervene in case things don’t go their way in certain matches.

But then moral hazard can be limited by doing things when things are going fine. ICC has got one opportunity to clean the game and I hope it does something fast. Otherwise, just like we see financial crisis get bigger, we will see worse cricket behavior ahead. 

It is thrilling to see when somethings which appear so distinct are so similar. I also posted about the similarity between financial markets research and cricket here and here.

Update: Hariharan Narayanswamy has an interesting article on the same. However, I think in this case the person did not have the bat and was trying to be a bully. It was hight time that he was taught a lesson.

Roads vs Cars, Airports vs airplanes etc etc

Reading the comments over Ratan Tata’s much awaited People’s car has made me wonder over the infrastructure issues in India. (Read in favour views here and here. And against view here) For the uninitiated the car is going to cost just Rs one lakh (about $ 2,500 in today’s currency) and will be the cheapest car in the world. Hence we are seeing a lot of commentary over the subject. The car would be unveiled in Autoexpo 2008, an automobile exhibition in New Delhi on Jan 10, 2008.

India is facing really tough problems like these:

• We have numerous cars, but not enough roads
• We have enough airlines and airplanes now, but not enough airports
• We have train tracks but trains don’t run on the same – like the harbour line from Vashi to Belapur. It could help decongest the trains quite a bit.

Infrastructure takes time to develop and because of little urgency shown earlier we have a huge deficit at hands. On the other hand, the things which help human beings utilise infrastructure like cars, motorcycles, airplanes etc have expanded big time leading to big management problems for authorities.

I am all for the People’s car but it is going to be a big-big concern for already jammed roads. And the jams are not just in large cities but more and worese in small towns. Reason?  Easy financing schemes (that is what the adverisers call it and we now know we should be careful) have made it easier for people to afford cars, motorcycles. As roads haven’t changed, we have jams all over.

Infact, the problem has become so bad at some places that one has to be a town expert (knowing all roads, sub-roads) in order to reach his work or home. The traffic has become so huge that a minor disturbance in a main highway leads to chaos like the National Highway 2 got disrupted at Agra and as a result the traffic from Kanpur to Delhi was disrupted. The jam ran upto almost 2-5 kms.

So, what do you do? Do you stop Tata from making cars? Do you stop ICICI from giving auto finance? Clearly both are not the right choices. People’s car would make car available to many, ICICI auto finance provides debt and using the equity one can buy the motor cycle/car/truck.

But then the issues with infrastructure are also a reality and one cannot just ignore it. The roads etc would take time to build and in many cases the traffic actually is more than the capacity of the new road. Hence we would have the policy dilemma for some time to come.

Understanding Credit Rating Agencies’ moves

Any financial crisis the credit rating agencies (CRA) are usually found wanting. They are equally blamed for any crisis whether it was the Enron crisis or the recent sub-prime crisis.

The allegation usually is that the rating accorded by the agencies usually are behind times and act after the crisis actually takes place i.e. they don’t downgrade a company/asset quickly enough. If they are following the company/asset they should be the first one to know of the ills. If they downgrade the company after everyone knows there is a problem there is not much sense to have a CRA.

What is the purpose of a CRA? It is to reduce information asymmetry. In other words, they help demystify the various financial statements by using their various analysts and experts and help the investors in making a decision whether to take an exposure (loan, equity etc) in the company.

So instead of reading through the various documents, you see what a CRA has to say and decide. So they have a pretty important role to play, but have failed when it matters the most. It has been pointed time and again that they only give ratings to please their clients.

It is actually preposterous that they get most of their income from the companies they rate, so there is no real incentive to issue a negative rating. I mean why should I pay you if you give me a thumbs down?

I was just thinking, why do CRA then downgrade companies immediately when times are bad? Well, a downgrade means, a company can raise its hands and say “Hey, I am making losses/bankrupt and the CRA also says so”.  Meaning I cannot pay up and don’t bother me. So, a CRA helps the company either ways

What is Financial Product Service Commission?

Elizabeth Warren, a Harvard Law Professor suggests time has come to take a look at setting a Financial Product Service Commission. Her idea is here. The snapshot of the idea is:

In the US today it is not possible to buy a toaster that has a 1-in-5 chance of bursting into flames and burning down a customer’s house. But it is possible to refinance an existing home with a mortgage that has the same 1-in-5 chance of putting the family out on the street—without ever disclosing that fact to the homeowner

The difference between the two markets is regulation. Although considered an epithet in Washington since Ronald Reagan swept into the White House, the Rword supports a booming market in tangible consumer goods. Nearly every product sold in America has passed basic safety regulations well in advance of being put on store shelves. Credit products, by comparison, are regulated by a tattered patchwork of federal and state laws that have failed to adapt to changing markets. Moreover, thanks to effective regulation, innovation in the market for physical products has led to more safety and cutting-edge features. By comparison, innovation in financial products has produced incomprehensible terms and sharp practices that have left families at the mercy of those who write the contracts.

She suggests that on the lines of US Consumer Product Safety Commission (CPSC), we must have a FPSC. Read the paper for further ideas.

The proposal couldn’t have been more timely. Financial Products are really complex and people don’t read even simple loan documents fully. And if you expect that they would read the complex terms that come with a much more complex loan ( NINJA, no doc , Negams  etc), we are expecting a bit too much. The caveat emptor principle cannot work in financial products as it requires a lot of effort to understand and monitor the developments. Even the best financial brains fail repeatedly trying to understand financial markets.

Great thinking.

What do you prefer- malls or homes?

Navi Mumbai(earlier known as New Bombay) was built to ease the population pressures in Mumbai. Navi Mumbai took time to pick-up but is now a 1.6 million city. While building Navi Mumbai, an effort was made to do some planning before the construction (I am told it is the second planned town in India after Chandigarh, it is funny  how we built towns in the country without any planning).

Within Navi Mumbai, Vashi has emerged as a major township and most people living in Navi Mumbai flock to Vashi over the weekends. The township was quite pleasant till a while back but it seems planning has been sent for a toss now.

Mumbai has developed around its local train network and as a result maximum crowding is around the stations. Also, you would find the local market, bus stand, residential apartments etc all around the railway station. The local train is the best way to commute in Mumbai and all this means stations are always crowded and messy.

So, in Navi Mumbai an effort was made to have minimal construction around the stations. A lot of open space was preserved around the railway stations in an effort to keep the stations efficient. The concept was pretty revolutionary to begin with and the railway stations became a hit. People came from Mumbai to see the stations and quite a few movies were shot around the area.

It was also planned to make Vashi’s railway station an information technology hub. There are a few companies housed there but I am told the concept did not take-off as expected.

However, the area around the station is seeing huge activity these days. There are a number of shopping malls being set up. At present there are 2 malls around the station (one is not fully functional) and about 4 more are coming up. Inside the township, there are 2 malls and couple of more coming up.

I keep wondering do we need these malls? That too at a time when housing prices in Mumbai and Navi Mumbai are zooming through the roof. (Economist even says don’t buy any property in Mumbai). The analysts often quip that it is a demand-supply issue and as demand is continued to be more in Mumbai, the prices continue to rise. But how would supply problems be eased if already scarce land is given for shopping malls. (Again, I do not say malls are not needed. They are needed as they provide huge benefits to consumers, but there has to be a balance)

Another problem is the nature of housing market in Navi Mumbai (In Mumbai it is slightly better because of some reputed builders). It is just too opaque and information asymmetry is at its highest. The transcation costs are extremely high and one is continuously scared about the quality of the product (the house that is).

There is an urgent need to regulate the housing markets especially in metros. There is a feeling that housing prices are artificially jacked up in these town as no one knows the correct price. Finding a decent place to live in Mumbai is a real nightmare. Most have no options but go through it, pay the brokers through their nose as it seems there is always a shortage of homes.

Mumbai has always been famous for its shortage of space and as a result the homes you find here are much smaller than available elsewhere for a similar price. However, now even finding those small homes is becoming a problem. As migration continues (every aspiring model, actor, finance professional etc wants to come to the city), the problem is only getting bigger.

The house is a basic need and when you add the infrastructure problems, the problem is extremely complex. The day there is a problem in the local trains and if it is a working day, only a miracle can help you reach home (for which you have already paid a fortune) at the right time.  Hats off to the management of local trains who work day in day out trying to minimise the problems, but the problems are quite common.

Lot needs to be done, before attempting to make Mumbai an IFC. It is too far fetched an idea.