Archive for December 22nd, 2011

A brilliant financial engineering solution to lower India’s fiscal deficit for FY 2011-12

December 22, 2011

I just did  a review of Govt’s finances after the second supplementary demand for expenditure. Like most others, the post sia situation is pretty grim. The exp to be higher and rev lower leading to a much wider fiscal deficit. How much was anyone’s guess.

However knowing fiscal mathematics and government innovation, one knows something will come. One major item for such innovation was disinvestment figure. Govt budgeted Rs 40ooo cr but so far just around 2500 cr in the kitty. So there were suggestions from Mohandas Pai that government should ask cash rich PSUs to declare aggressive dividends. This was opposed  by SS Aiyar saying govt should not fritter away gains in commodity booms.

Now comes this wire from Bloomberg on another new plan. I must say upfront this is just speculation so far and coule be completely false. However, the mechanism is just brilliant fin eng:

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How inequality is basically a race between education and technology..

December 22, 2011

A superb interview of Daron Acemoglu of MIT. He picks 5 books on the subject (4 books and one paper actually).

His first pick is a book called  The Race between Education and Technology By Claudia Goldin and Lawrence Katz. The books explains how does inequality arise:

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