February 24, 2016

‘Pikettymania’ Arrives in India

Vivek Dehejia's article in the Mint titled, "A wrong priority for India" was quoted in a recent CIGI article by Keven Carmichael on the inequality debate in India. 

 

Excerpts from the Article are below: 

 

"Thomas Piketty is a world-famous economist. Arvind Subramanian is almost famous. He is the chief economic adviser in the government of Indian Prime Minister Narendra Modi, a man who fills stadiums around the globe and runs an emerging global power. That made Piketty vs. Subramanian a big attraction at the Jaipur Literature Festival in January."

 

"There are few better expressions of extreme wealth and extreme poverty than a city such as Mumbai, home both to the world’s most expensive real estate and sprawling slums. Yet Subramanian called Piketty’s conclusions a First World problem...Subramanian isn’t alone in confronting Piketty on these terms. “The usual economist’s criterion for a policy worth pursuing is ‘Pareto improvement’ -- that is, making at least some people better off, while harming no one,Vivek Dehejia, an associate professor of economics at Canada's Carleton University and a resident fellow at the IDFC Institute in Mumbai, wrote in the Mint newspaper on Feb. 15. “This is entirely consistent with rising incomes, falling poverty and rising inequality.

 

Dehejia acknowledged that economists such as Paul Krugman and Joseph Stiglitz may be right when they say the United States should use fiscal policy to reduce the gap between the richest and the rest. But India’s concern should be removing the constraints on gross domestic product. “This is not because anyone fetishizes GDP, but because economic theory and evidence from many places and times teach us that high and sustained economic growth is the only viable path to reducing poverty and combating other social ills,” Dehejia added."

 

Read the full article here.

Topic : Transitions / In : OP-EDS
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