Extractive political institutions (autocracy and empire) lead to extractive economies benefiting elites, and cannot create general prosperity save for limited periods. Inclusive political institutions (democracy, rule of law and rights for all) create inclusive economic regimes with opportunity for all, …
Rapid GDP growth is the best antidote for poverty. That is the big message that comes blaring out of the poverty data for 2009-10. Record GDP growth of 8.5% per year between 2004-05 and 2009-10 has reduced poverty at a …
Manpreet Badal, former Punjab finance minister and nephew of chief minister P S Badal, broke last year with the Akali Dal, complaining that his entreaties for fiscal discipline were being ignored, and would lead to disaster. He looks foolish today …
Fiscal consolidation is the need of the hour, and the finance minister should rationalise subsidies. The best way forward is to end price controls for items like urea and diesel, since these constitute the most irrational, lopsided way of allocating …
Budget 2012: Price controls, open-ended subsidies throw budget allocations off-kilter Read More »
One European scenario shows Germany dominating Europe, forcing austerity on its southern neighbours as a price for staying in the eurozone. A second scenario suggests a eurozone break-up in protest against humiliating austerity. Greece has just voted for a new …
The logic of the electoral cycle points unambiguously to a tough budget with stiff taxes, curbs on populist spending, and an emphasis on controlling a runaway fiscal deficit. The next general election is due in May 2014. Hence there will …
Budget 2012: Measures Pranab Mukherjee should take to increase revenue and cut spending Read More »
The IMF wants to increase its lending capacity by $1 trillion, to rescue distressed countries in the eurozone plus those hit by aftershocks from the eurozone. But US is struggling with fiscal problems of its own, Japan now has the …
Time to end West\’s farm subsidy as a condition for funding European bailouts Read More »
The IMF wants to increase its lending capacity by $1 trillion, to rescue distressed countries in the eurozone plus those hit by aftershocks from the eurozone. But US is struggling with fiscal problems of its own, Japan now has the …
Time to end West\’s farm subsidy as a condition for funding European bailouts Read More »
Most people think of the eurozone crisis as a fiscal crisis. They see the southern European countries collectively called the PIIGS (Portugal, Ireland, Italy, Greece and Spain) with huge debt/GDP ratios or huge fiscal deficits that look unsustainable, and require …
Slowing tax revenue and rising government spending on food security and universal health threaten to send the fiscal deficit skyrocketing next year. To check this, many experts want to raid the surpluses of public sector undertakings (PSUs). These surpluses have …
India should not fritter away PSU profits from commodity boom Read More »
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