Jayati Ghosh’s Blog

How to mitigate and reverse the adverse impact of the demonetisation ought to be at the top of the Finance Minister’s agenda for the coming Budget. The effects of the ill-considered and even more poorly implemented scheme are still being felt across the country, in the form of reduced economic activity, job losses and reductions in income and consumption. Since remonetisation is still incomplete – and the government has already threatened not to replace the full value of the demonetised currency in a coercive push to digitisation – the impact on economic activity from that one source alone will continue…

This year’s Budget would never have been easy to present, with the economic uncertainty swirling around the globe and the demonetisation-induced domestic downturn still ongoing in the Indian economy. But the Modi government seems to be determined to make its own task harder. It has managed to generate expectations that will almost inevitably be unfulfilled, through a weird combination of denial of the manifold ill-effects of demonetisation, encouragement of all sorts of ideas around the universal basic income, and simultaneous acceptance of relatively rigid fiscal targets. But consider first the very timing of the Budget announcement, in the context of…

The government's claim that it has ensured electricity for all does not seem to be warranted by the evidence. Spreading_Light  (Download the full text in PDF format) (This article was originally published in the Business Line on January 30, 2017.)

We all know that the world is an unequal place, both across and within countries. We also know that across the world, people are expressing their anger and disgust at this inequality. This is increasingly revealed in extreme and often paradoxical political results. In the USA, a vote against the establishment has just delivered to power the ultimate crony capitalist, Donald Trump. In the United Kingdom people voted to leave the European Union in the false expectation that curbing migration will improve their own life chances. In India the poor, disgusted by a corrupt self-enriching elite, support a bizarre and…

Is there no one left in our important institutions who is still capable of speaking truth to power? The last year has seen a depressing – even frightening – erosion in the credibility of the major institutions that in different ways are vital for the functioning of our democracy. It is true that the Congress Party when in power has also not covered itself in glory in terms of respecting such institutions, except when forced to do so. But the current “low, dishonest” phase of history (in W.H. Auden’s apt phrase) that we are experiencing in India surely marks a…

Banks strapped with stressed assets are holding back on lending, dampening in the process the principal stimulus to growth in recent years. And there are no alternative routes to growth in sight. Waning_Stimuli   (Download the full text in PDF format) (This article was originally published in the Business Line on January 16, 2017.)

In the context of the failed demonetisation and continued shortage of currency, the government continues to push cashless digital payments. What are the implications for Indians? Digital_Payments    (Download the full text in PDF format) (This article was originally published in the Business Line on January 2, 2017.)

With the US Federal Reserve deciding to exit the era of low interest rates even when growth in the rest of the world economy falters or remains sluggish, economic uncertainty intensifies. Age_Uncertainty (Download the full text in PDF format) (This article was originally published in the Business Line on December 19, 2016)

“Plastic is the new khadi” is the currently popular saying transmitted across social media.  As Prime Minister Narendra Modi and his government continuously shift the goal posts of the extraordinarily violent demonetisation move, it turns out that the fruit of all the trauma that the majority of the Indian population is going through will be – to become a cashless society! The exhortation to move to e-payments has become the basis for the new definition of nationalism: the ability to pay for something with a card or a mobile phone or internet account is now the real proof of your…

The social contract between a state and its citizens is a complex thing. Philosophers of the European “Enlightenment” saw it as the basis on which society is organised so as to ensure the mutual protection and welfare of its members. It is therefore the implicit social arrangement whereby citizens give up some of their rights and freedoms to the state or a similar authority, in return for some degree of order and stability that would effectively ensure the protection of their remaining rights and freedoms. In very unequal societies, the voluntary nature of such a social contract is not particularly…