Jayati Ghosh’s Blog

The world has been preoccupied with the Covid-19 pandemic, and this has also affected policymakers everywhere. There is much more recognition today of the terrible effects of underfunding public health over decades and how this affects the resilience of economies and societies. Yet this official preoccupation with addressing the spread of infectious disease appears to have had an unanticipated negative effect: less policy attention to concerns of food security and hunger.  Poor nutrition is a major underlying factor affecting overall health conditions as well as resistance to disease, yet politicians and global leaders seem to have taken their eyes off…

There is one central message of the Narendra Modi government to the people of India from Budget 2021-22: you will have to be ‘atmanirbhar’ because you’re on your own. The Central government does not have your back. In the midst of the worst health and economic crisis the country has faced since Independence, it will not protect you. It will not spend more to enable food security and employment security, even though its own laws promise that. It will not provide sufficient resources to state governments for them to meet their obligations on health, education and all other essential services…

It is that time of year in India, when all eyes and ears turn to the Finance Minister to learn what she will unveil in the annual Union Budget. But it is a moot point whether, even in a year of the novel coronavirus pandemic and economic crisis that speech will be of much significance. Indeed, it could be argued that there may be little point in listening to or poring over a speech that is likely to conceal more than it reveals. What might be said Going by past experience, we can make some predictions about the Finance Minister’s…

There are really only two numbers to look out for in the forthcoming budget: how much did the government claim to have spent in 2020-21, and how much does it intend to spend in 2021-22. These two numbers will determine whether there is any real hope of sustained macroeconomic recovery in the near future, notwithstanding any claims of green shoots or revival that the finance minister may point to. As it is, the Indian government’s response to COVID-19 has been, in purely economic terms, one of the worst in the world.  Not only did it impose a national lockdown without notice…

India’s Constitution puts the bulk of responsibility for the basic goods and services to be provided to citizens on to state governments. That is also why it mandated that independent Finance Commissions be appointed every five years to determine the distribution of tax revenues between Centre and the various states. Successive Finance Commissions (FCs) have also recognised that state governments necessarily require more resources to fulfil their obligations, which is why the share of tax revenues to be devolved to states has been steadily increasing across such Commissions, from 29.5 per cent in the 11th FC to as much as…

The US is nowhere near as economically dominant as it was even a decade ago. Yet President-elect Joe Biden can take several relatively simple steps that would have far-reaching benefits for the US economy, the American people, and the rest of the world. Click here for full article. (This article was originally published in the Project Syndicate on January 19, 2020)

UMass Economics Professor Jayati Ghosh points out how pharmaceutical companies not only received massive subsidies for developing a vaccine, but are now trying to hold on to patent monopolies, which will only prolong the pandemic for everyone. https://open.spotify.com/episode/5ofXRYMFaSegYyJ19Y6Pbt?si=a3g6WWGRR7ONMA2AZAkW9Q  

The complete absence of any meaningful fiscal response from the Indian government in the face of one of the biggest economic crises ever faced, cries out for explanation. One argument has been that the central government is concerned about its external vulnerability: a large increase in public spending could generate higher imports, thereby worsening the trade deficit at a time when volatile capital flows have already made the balance of payments vulnerable. Is this fear justified? It is certainly true that India’s external sector has been weak and vulnerable for some time now, and a dramatic exodus of foreign capital…