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    BLOG POSTS

    In this blog post, Brank Milanovic re-visits inequality in India by using income based surveys of Indian population for 2004 and 2011. The gap between the slow moving survey mean and much faster changes in per capita GDP was also explained by the failure of NSS to capture top incomes. The top incomes may have been pulling up the mean (presumably reflected in GDP pe...
    Advisory Board member, Manish Sabharwal writes in this World Bank blog that changing the ways that India’s benefits regimes are funded would be the most impactful way to reform the country’s labour market. "When people think of labour law reform in India they tend to think of the laws around hiring and firing; specifically, reforming Chapter 5B of the Industria...
    In this Mint article, Vivek Dehejia of IDFC Institute shares his reflections on the recent assembly elections in India and what they augur for the governing BJP and the opposition Congress parties. (Note that in the original submission the headline had a question mark) "The mightily impressive win in Assam, and a good showing (in votes if not yet in seats) in ...

    23 May 2016

    The Times Table

    In this Outlook article, Praveen Chakravarty argues that increasingly voter disenchantment with the national parties is carrying through state and national elections. "Clearly, both (Congress and BJP) lost more assembly seats to regional parties in these four states between 2014 and 2016. This is perhaps the biggest takeaway for the 2019 Lok Sab...
    In this New Indian Express article, Shankkar Aiyar writes about the need for a credible alternative at the national level that is neither the freebie populists nor it cannot be the caste warriors. "Drill down the granular details of the polls to appreciate the magnitude of the slide. In the 10 states that went to polls after May 2014, the Congress won just 217...
    Mihir Sharma, Opinion Editor at Business Standard, joined us at the sidelines of the IDFC Institute Political Economy Dialogues to discuss shortfalls of using Special Purpose Vehicles as governance tools, alternative approaches, and building state capacity. ...
    In this India Spend article, Rithika Kumar and Swapnil Bhandari, Senior Analyst and Associate at IDFC Institute present their analysis of the electoral results in Assam, Kerala, West Bengaland Tamil Nadu.  Excerpts from the article are below: "Three factors worked for the BJP in Assam........a wave of anti-incumbency; pre-poll alliances ...
    In this Indian Express article, Dr. Arvind Panagariaya, Vice Chairman, NITI Ayog reflects on the economic reforms initiated by Prime Minister Narendra Modi led NDA Government durings its two years in office. The article opines that "Substantial progress progress has been made towards restoring economic momentum. Much remains to be done"  Excerpt...
    In this Indiaspend article, Swapnil Bhandari and Rithika Kumar of IDFC Institute write about the anti-incumbency vote for BJP in Assam against the backdrop of high voter turnout. "We analysed the contested vote share of BJP and Congress in the last two elections–2011 state assembly and the 2014 Lok Sabha elections–and compared it to the voter turnout in 2014. V...
    Visitng Fellow, Shankkar Aiyar in this The New Indian Express article looks at the current tenure of the Governor of Reserve Bank of India, Dr. Raghuram Govind Rajan and gives a politico-economic lowdown on his accomplishments as the Governor. While lauding his policy moves for making the banking system more accountable and transparent he...
    Resident Fellow, Vivek Dehejia writes in the Mint about the core topic of discussion in the International Monetary Fund's April edition of the World Economic Outlook, "Too Slow for Too Long". He writes "The IMF estimates that, between 2010 and the third quarter of 2015, net capital inflows into emerging economies fell by a whopping $1.123 trillion for a sample of 45 e...
    In this Guardian Cities article, see incredible images of how the Pearl River Delta - the world's largest continuous urban region that encompasses Hong Kong, Guangzhou and Shenzhen - has transformed from 1979 to now....
    Raghuram Rajan makes a critical point that lies at the heart of IDFC Institute's work - that while policy making is easy, getting political acceptance for implementation is the harder part. Read the Economic Times article here. ...
    This week, our Resident Senior Fellow Vivek Dehejia joined Kalpana Kochhar (IMF), Derek Scissors (American Enterprise Institute) and Milan Vaishnav (Carnegie Endowment for International Peace) to discuss Modinomics at Two: Is it Working for India and its Citizens? Watch the video below! ...
    In this blogpost, Renuka Sane and Neha Sinha discuss why we need to look beyond statistics on pendency and disposal of cases, and instead measure the other steps along the way from crime to conviction.  "Our ultimate objective, however, is to create deterrence against crime. The criminal justice system is the interlocking institutional infrastructure of laws, polic...
    The Guardian documents the astonishing, controversial rise of Shenzhen, an "unremarkable Chinese settlement that ‘smelled of countryside’" to become to world's largest megalopolis.   "Shenzhen, a city of around 11 million people, is now merely one element of the Pearl River Delta, the world’s largest continuously urbanised area with a ...
    In this article for Mint, IDFC Institute Resident Senior Fellow Vivek Dehejia argues that NITI Aayog's presentation to the government - Creating a Movement for Change - should be evaluated for what it is supposed to be, a roadmap for the bureaucracy to function better, and not be misconstrued as a statement of economic policy.   "Judged on its own te...
    In this Business Standard article Praveen Chakravarty and TV Mohandas Pai argue that "the notion that there is one right valuation for a company is absurd. To pretend that the government is the best judge of this valuation and to use that as the basis for persecution is tyrannical." While the government has the right to investigate investors' source of funds, ...
    In this New Indian Express article IDFC Institute Visiting Fellow Shankkar Aiyar highlights some of the persistent problems that bedevil the Indian state and the lack of political will to address them. Vacancies in government postings, a failure to bring economic offenders to book, contamination of the Yamuna and encroachment of government land are just a few nev...
    Saskia Sassen, on the occasion of 100th anniversary of Jane Jacobs' birth, in this The Guardian article  looks back on Jacobs' inslights on cities. "She pursued a line of questioning quite different from what I usually get. She continously returned to the issue of “place”, and its importance when considering the implementation of urban ...
    In this New Indian Express Article , Visiting Fellow at IDFC Institute,Shankkar Aiyar says that " the system and discourse [on draught management] focus too much on the consequence and too little on the causatives" "Drought was discussed last week too—in the Lok Sabha and the Rajya Sabha. There was much politics—who did better on what. There...
    Emily Washington in this Market Urbanism article says that the "regulations that restrict urban development likewise reduce opportunities for innovation and specialization by limiting cities’ population size and density." and "removing land use regulations will allow greater gains from trade as more people are allowed to live in important economic centers like New Y...
    In this ET article, Charu Khanna emphasizes the importance of change management in getting public support when working for the common good. "Organizational Behavior 101 begins with the argument that successful change needs a change champion. Chief Minister Arvind Kejriwal was this and more. Besides advocating for the change from a variety of media, he and his ...
    In this Quartz article, Parag Khanna emphasizes megacities and megacity regions are "magnets for regional wealth....[and have] been the most significant contributor to shifting the world’s focal point of economic activity". These cityregions "deserve more nuanced treatment on our maps than simply as homogeneous black dots" he says. "This map fr...
    Shout out to everyone in the DC area! Visiting Fellow in Political Economy, Vivek Dehejia will be a member of a distinguished panel on "Modinomics at Two", moderated by Sadanand Dhume with Milan Vaishnav Derek Scissors and Kalpana Kochhar at the American Enterprise Institute on Tuesday, May 10, 2016. For those unable to attend, the event will ...
    Visiting Fellow, Shankkar Aiyar writes in the Indian Express: " This week, Niti Aayog put out a perspective on where it sees India in 2032. It is not called a plan, nor is it called vision-whatever.  It is simply titled ‘Creating a Movement for Change’. Without much ado, it lists aims, objectives and an agenda of sorts. Conventional wisdom suggests forward pl...
    Abvisory Board member, Manish Sabharwal along with co-author Sumit Kumar, write about the need for a strong apprenticeship program in India. They write "We would like to make the case that an important solution to India's challenges of education, employment and employability lies in state governments adopting apprenticeships on a large scale....The quest for...
    In this Mint article, Resident Fellow at IDFC Institute, Vivek Dehejia talks about how story telling impacts electoral outcomes. He writes "Reagan told Americans that, if elected, he would get government off the back of average folk and empower them to take control of their own lives. Without needing to invoke Friedrich von Hayek or Milton Friedman, he evoked a heady,...
    This World Economic Forum piece highlights the status of women's land rights across the developing world, and the benefits of women owning land. Excerpts below: "Women account for nearly half of the developing world's farmers, yet they own far less land than men despite growing evidence that increasing female land ownership can boost food production, education lev...
    In this Observer article, Alex Tabarrok responds to a question on Quora, asking what the US needs to do to create a more sustainable middle class. Excerpts below: "I worry most of all that we are becoming a rent-seeking society. The idea of rent-seeking is best explained by the old metaphor of the pie. There are two ways to get a larger slice of the pie. Grow the p...
    Praveen Chakravarty  writes in Mint that priority sector lending "has the potential to increase efficiency in banking without sacrificing on larger inclusion and equity goals". Excerpts below: "A bee-keeping farmer can be given Rs.2 crore in loans but a paddy farmer can only get Rs.50 lakh. For buying a home in a town with a population of more than a mill...
    Congratulations to Reuben Abraham, CEO and Senior Fellow at IDFC Institute, for his position as Asia Fellow at Milken Institute. The Milken Institute is a nonprofit, nonpartisan think tank determined to increase global prosperity by advancing collaborative solutions that widen access to capital, create jobs and improve health. They do this through independent, data...

    21 April 2016

    Beyond Econ 101

    In this New York Times piece, Paul Krugman argues that "even when Econ 101 is right, that doesn’t always mean that it’s important". Excerpts below: "...a phenomenon I’ll call “101 boosterism.”...The name is a takeoff on Noah Smith’s clever writing about “101ism”, in which economics writers present Econ 101 stuff about supply, demand, and h...
    In this Project Syndicate article, Dani Rodrik argues that "Progressives should not buy into a false and counter-productive narrative that sets the interests of the global poor against the interests of rich countries’ lower and middle classes." Excerpts below: "...The US presidential candidates Bernie Sanders and Donald Trump have both made opposition to trade ag...
    In this article, Vivek Deheja reviews the debate sparked by Robert Gordon's thesis that the era of high growth is over. "These are at present but academic questions in fast-growing emerging economies such as India, which is expected to grow anywhere between 7% and 8% during the current and coming fiscal years. But it is fast becoming an existential debate in a...
    IDFC Institute Visiting Fellow Renuka Sane  writes in Business Standard: "The system for resolving personal insolvency is broken. The inability to recover loans through legal means has led to incidents of recovery through musclemen. The RBI has issued circulars against coercive collection". Excerpts below: "The problem of large-scale non-performing assets, or NPAs,...
    Narayan Ramachandran, Chairman of RBL Bank, joined us at the sidelines of the IDFC Institute Political Economy Dialogues to discuss the economic and political systems in India and China, conditional cash transfers, and social business as a tool of development. ...
    Rajeev Gowda, Member of Parliament in the Rajya Sabha and National Spokesperson of the Indian National Congress, joined us at the sidelines of the IDFC Institute Political Economy Dialogues to discuss the outcomes of the present system of election funding in India and ways to reform campaign finance.   ...
    Vivek Dehejia argues that it is time to give serious consideration to the idea of a single global currency. Describing the period of monetary policy two decades prior to the financial crisis, he notes, "a certain hubris had set in among central bankers and conventional macroeconomists: the notion that the “modern” policy of inflation targeting by independent nationa...
    Pritika Hingorani and Komal Hiranandani write in Swarajya magazine's special edition on Smart Cities: "The way we choose to finance and structure the Smart Cities initiative has direct implications for governance and who holds power in our cities." Excerpts below: "Since late last year, a few Indian cities... have been hitting the news for wanting to pull out of...
    Ashwin Mahesh, National Vice President of Loksatta Party, joined us at the sidelines of the IDFC Institute Dialogues on Political Economy to discuss governance problems with managing urbanisation in India, the underrepresentation of urban areas politically, increasing citizen participation, and how projects in Bangalore innovatively overcame civic challenges. ...
    Nuances of having simultaneous state and national elections explored in this article by Praveen Chakravarty that appeared in the Hindu. He says simultaneous elections for State Assemblies and Parliament can have a tangible, and perhaps undesirable, impact on voter behaviour. "It is a widely held belief among political observers and politicians that the In...
    Karthik Muralidharan, Associate Professor of Economics at the University of California, San Diego, joined us at the sidelines of the IDFC Institute Dialogues on Political Economy to discuss designing robust RCT studies and complex government programmes, based on his co-authored Working Paper, "Payments Infrastructure and the Performance of Public Programs: Evidence fr...
    “The Permanent Campaign” was a phrase coined and popularised by Sidney Blumenthal, adviser to Bill and Hillary Clinton, in his 1980 book that lamented the compulsions of incessant election campaigns that crowd out time for policy making. Prime Minister Modi agrees with Blumenthal. Reportedly, at a recent national executive meeting of the Bharatiya Janata Party, the Pri...
    Lant Pritchett, Professor of the Practice of International Development at the Kennedy School of Government at Harvard University, joined us at the sidelines of the IDFC Institute Dialogues on Political Economy to discuss methodological issues with current measures of Development and Ease of Doing Business, and how such indicators can help countries strategise for growth. ...
    IDFC Institute's first Working Paper, "What’s In A Definition?: A Study On Implications And Suitability Of Urban Definitions In India Through Its Employment Guarantee Programme", is now online. The paper has been co-authored by Vaidehi Tandel, Komal Hiranandani, and Mudit Kapoor. Abstract: In this paper, we discuss the political economy of the definitions of urb...
    In this livemint article Anjali Sharma and Susan Thomas discuss how the proposed Bankruptcy code with its focus on speedy resolution could have helped lenders in the Kingfisher Airlines case. Excerpts from the article are below "Robust banking regulation and a sound bankruptcy process share a common goal: to recognize bad news and act quickly. This is ...
    KP Krishnan, Additional Secretary at the Department of Land Resources in India's Ministry of Rural Development, joined us at the sidelines of the IDFC Institute Dialogues on Political Economy to discuss issues with land titling in India and reforms that can bring India closer to conclusive titling. ...
    In this Live Mint article, Karthik Sashidhar examines the underlying dynamics that inform the calculation of Inflation statistics in India. He argues that, "The weights attached to different product groups for the purpose of calculating the inflation rate present a fascinating picture of how government statisticians think India lives." Key excerpts f...
    Zia Khan, Vice President for Initiatives and Strategy at The Rockefeller Foundation, joined us at the sidelines of the IDFC Institute Dialogues on Political Economy to discuss how social enterprises should be managed, how risk should be rationalised in development programmes, and the role of the government, the social sector, and business in development. ...
    Visiting Fellow, Praveen Chakravarty in his News Minute article examines the likely impact of the DMDK lead third front on Tamil Nadu’s otherwise stable political landscape. Excerpts from the analysis are presented below "Amid... powerful, dominating bi-polar forces in Tamil Nadu politics, one wonders why this “kolaveri” over an entire alphabet soup o...
    Visiting fellow Shankkar Aiyar writes in the New Indian Express about the looming water crisis in an increasingly urbanizing India. He maintains that "...the crisis is an opportunity to disinvest incrementalism and invest in scalable smart solutions."  Excerpts below: "It would be tempting to blame the failed monsoon for the water crisis. Tha...

    28 March 2016

    Modinomics at two

    In this Mint article, Vivek Dehejia, Resident Fellow at IDFC Institute, writes that at the end of his two years as the PM, Narendra Modi should be best described as a pragmatic modernizer of the government’s role in the economy. Commenting on what appears to be the changing perception of Mr. Modi's Prime Ministership, Dehejia writes  "..... ju...
    IDFC Institute's Vivek Dehejia wrote in Mint about "arcane economics concept from the 1930s" that "occupy centre stage in economic policy debates today". Excerpts below: "... along with “financial instability”, “secular stagnation” is now well on its way to becoming a household term. It befits an era of economic volatility in a global economy which is yet to rec...
    Visiting Fellow, Sanjeev Sanyal, in this ET article, says that ' a complex world cannot be managed by increasing complexity but through simplicity and flexibility. Since there is no equilibrium, it’s all about triggering virtuous cycles and then managing the distortions that necessarily accompany them' "Most conventional frameworks from Keynesian to Mon...
    Nandan Nilekani, in this article, says "India has a unique opportunity to create a new and alternative credit infrastructure that can provide easy access to credit for millions of businesses and individuals, arising from the convergence of Aadhaar’s recent legislative legitimacy with regulatory innovation, technology and digitisation." He says " the traditio...
    Manish Sabharwal and Shihabudin Abdulkhader write in Business Standard: "India's labour laws force employers to use five billion sheets of paper or 600,000 trees a year. It's time we dispensed with the paper trail and shifted all labour law paper, workflows and permissions online." Excerpts below: "Our labour laws require service enterprises to maintain 25 register...
    In this Mint article, Vivek Dehejia, Resident Fellow at IDFC Institute, writes that India should stand firm for genuine free trade and should not sign trade agreements such as TPP that do not serve its national interest. He writes " India lacks the clout either to engineer a reboot of DDA or to shape the structure of emerging alternatives to TPP, in ...
    IDFC Institute Visiting Fellow Renuka Sane writes in Indian Express: "Pension reform is important. But next time, Centre must put in more rigour." Excerpts below: "The Union budget’s proposal — now unfortunately rolled back, given the furore — to rationalise the tax treatment across the NPS and EPF had raised quite a storm. Withdrawals greater than 40 per cent ...
    IDFC Institute's Vaidehi Tandel and Komal Hiranandani  wrote about urbanisation in India for the World Bank's "Jobs and Development" blog. Excerpts below: "Urbanization in India is set to take off in the coming years. At 31%, India’s official urbanization rate is far lower than that of other BRICS nations. However... (a)n ongoing study by IDFC Institu...



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