The Exploitation Time Bomb Jayati Ghosh
Worsening economic inequality in recent years is largely the result of policy choices that reflect the political influence and lobbying power of the rich. There is now a self-reinforcing pattern of high profits, low investment, and rising inequality posing a threat not only to economic growth, but also to democracy. Click here for full article. (This article was originally published in the Project Syndicate on July 16, 2019)
Budget 2019-20: The numbers the Finance Minister does not want you to see Jayati Ghosh
When finance minister Nirmala Sitharaman’s Budget speech omitted numbers relating to the government’s overall revenue and expenditure, for both the previous and current years, this was widely commented on. After all, these numbers are the reason for having a Budget speech in the first place – to provide parliament and the general public a quick overview of the state of the Central government’s finances. Her response to this criticism was that all these numbers are available in the supplementary material provided in the Budget documents, so there is no need to go into them in the speech. But most people…
Reviving India’s household savings and investments should be the budget’s top concern Jayati Ghosh
Falling investment rates have cast a shadow on claims of a buoyant and dynamic India made by successive governments. Before it came to power in 2014, the ruling Bharatiya Janata Party (BJP) had made it a political issue. Since then, it has been less than successful in restoring investments to levels seen in the first decade of the century. The government now argues that investment rates have finally begun to rise. While this may be true, current rates are still low compared to financial year 2012, or even earlier years. In constant price terms, real investment as a share of…
Budget 2019 Reeks of a Lack of Real Ambition Jayati Ghosh
In terms of economic vision, it has always been difficult to make sense of the Narendra Modi government. The previous five years were hardly inspiring in economic terms: relatively little was done in terms of positive changes to address the major problems in the economy. Most economic policies of the earlier government – including some more problematic ones – were simply continued, often in a renamed or repackaged form, while the regime was punctuated by the twin disasters of demonetisation and the badly botched and rushed implementation of the goods and services tax. Meanwhile, especially before the general election, the…
The Bogey of Currency Manipulation C. P. Chandrasekhar and Jayati Ghosh
In the past decade, talk of “currency manipulation” has become a frequent trope in discussions of international trade. Much of this stems from the US government’s aggressive position on the bilateral trade deficits the US has with several countries, and the associated tendency to blame these deficits on “currency manipulation” by governments of these countries. This has generated a wider tendency for others to assume that some developing countries have been successful exporters by systematically “undervaluing” their currencies. There are many reasons to question this easy assumption. But whatever little truth there may have been in such an argument in…
Blame US Trade Policy for Sky High Drug Prices Jayati Ghosh
Jayati Ghosh argues that it is ironic that a US administration attempting to lower drug prices for Americans is also pushing for changes in intellectual property rules in ways that would allow multinationals to hugely hike pharmaceutical prices in foreign markets like India. Click here for full article. (This article was originally published in the Project Syndicate on June 10, 2019)
Warning signs from External Trade C. P. Chandrasekhar and Jayait Ghosh
As if all the bad news from the domestic economy were not enough, foreign trade data suggest worrisome trends on the external front as well. The latest report of monthly trade data from the Ministry of Commerce and Industry indicates that merchandise exports (in US $ terms) in April 2019 increased by only 0.64 per cent over April 2018, while imports grew by 4.48 per cent. This stagnation of exports is truly worrying because it is well below the rate of growth of world exports in the same period. But is this just some current problem, or have external trade…
Gendered Labour Markets and Capitalist Accumulation Jayati Ghosh
Gender relations affect economic processes, especially macroeconomic patterns and accumulation trajectories, so capitalism relies on gender construction of societies to further its expansion. For example, changes in women’s involvement in paid and unpaid work impacts the extent to which the unpaid care economy subsidises the formal economy. Failure to recognise this leads to misleading estimates of aggregate labour productivity and its change over time. Similarly, ignoring the gender distribution of cross border migration can lead to wrong expectations about the patterns of remittance flows during business cycles in the receiving country. Click here for full text (This article was originally…
The Real Victims of China’s Trade Patterns Jayati Ghosh
Jayati Ghosh argues that the recent trade trends are the cause of both macroeconomic and sectorial concerns for China’s trading partners in developing Asia, however, these countries’ have limited options for resisting these trends. For full article Click Here (This article was originally published in the Project Syndicate on May 10, 2019)
China’s Trade with other Asian countries C. P. Chandrasekhar and Jayati Ghosh
Just before the Global Financial Crisis more than a decade ago, China had emerged as the most significant trading partner for a majority of the world’s economies. Since then, it has had even more significant impacts on global exports and imports. This is especially true for developing countries, particularly those in developing Asia. (In the discussion that follows, only merchandise trade is considered.) But these effects are now more complex. China’s now legendary trade surpluses began showing shortly after its entry into the WTO on 31 December 2001. As Figure 1 shows, exports increased rapidly until 2008, and also recovered…