For a long time, as a college professor and then as the chief economic adviser to the Indian government, I was a happy user of the World Bank’s data on global poverty, tracking trends and analyzing cross-country patterns. I seldom paused to think about how those numbers were computed. Then, three years ago, I joined the World Bank as its Chief Economist. It was like a customer, happily ordering dinner in a favorite restaurant, suddenly being asked to go into the kitchen and prepare the meal.
Kaushik Basu's blog
Last month, the World Bank and IMF both put out predictions that, this year, India would overtake China in terms of GDP growth rate. This caused a flutter and was widely reported around the world. How robust is this prediction and what does it really mean?
First, this is not as monumental a milestone as some commentators made it out to be. China has had one of the most remarkable growth runs witnessed in human history, having exceeded an annual growth of 9% from 1980 to now. Four decades ago its per capita income was close to India’s, but now it is four times as large as India’s. None of all this is going to change in a hurry.
With this caveat in mind, it is a year in which India deserves to feel good. It is expected to top the World Bank’s chart of growth rates in major nations of the world. This has never happened before. Before 1990, India did occasionally grow faster than China, mainly because China’s growth gyrated wildly during the pre-Deng Xiaoping period. It was, for instance, minus 27% in 1961, when Mao Zedong’s Great Leap Forward resulted in the world’s biggest famine, and it was 17% and 19% in 1969 and 1970, respectively--a relief in the wake of the Cultural Revolution. Fluctuations of this magnitude would be intolerable to India’s polity.
‘Development Economics: The Big Questions’ was the topic of a lecture I delivered April 7 at Georgetown University. During my talk, I touched on micro-theoretic issues related to Mind, Society, and Behavior (the topic of the WDR 2015) and as well as on governance and the law (the topic of the WDR 2017, which is in its very early stages). From assumptions about rational actors, to the role of social norms, as well as lessons from game theory, I attempted to shed a rather different light on human foibles and the challenges of development than is typically expected from the World Bank.
Globally, men are nearly twice as likely as women to hold full-time jobs. On average, women earn between 10 and 30 percent less than working men, while they spend at least twice as much time as men on unpaid domestic work, such as caring for family members and doing housework.
Today my team has published a paper that looks into how the rapid expansion of oil supply from unconventional sources, OPEC’s change of strategy, and weak global demand drove the decline in oil prices.
This blog appeared originally in The Times of India
The control of corruption is commonly treated as the responsibility of government. The presumption is that people, firms and corporations will be what they are. So if corruption flourishes in a country, it reflects a failure of government. In informal discussions in the bazaar and angry public forums, the demands are invariably for greater honesty among government servants, tougher laws, and better enforcement. The public outrage against corruption is understandable for corruption is among the biggest obstacles to economic development. At the same time, the solutions offered in popular discourses are often naïve.