Amartya Sen, Nobel Laureate and economist, speaks to Suvojit Bagchi (The Hindu)
The truth may ultimately prevail about demonetisation, but the government might be able to maintain the loyalty of a large part of the public for a long time, says Amartya Sen
More than two months after the demonetisation, Nobel Laureate and economist Amartya Sen says that any proper “economic reasoning could not have sensibly led to such a ham-handed policy.” He predicts that the demonetisation will hit the economy quite drastically. In an interview with Suvojit Bagchi at his home in Santiniketan, which he visits every winter, Professor Sen spoke about the motives and impact of the move.
* We’ve seen the primary impact of the demonetisation: long queues outside banks and shortage of cash. Now we are seeing the secondary impact, which is on the informal sector. Potato sowing in West Bengal is affected and some other businesses are collapsing. What could be the impact of all this?
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Pronab Sen, Country director of the International Growth Centre, interviewed by Ajaz Ashraf
India’s first chief statistician, Pronab Sen, is now country director of the International Growth Centre, which seeks to build effective growth facilities through engagement between policymakers and researchers. In this interview to Scroll.in, he speaks on the 50 days of demonetisation, its failings, its severe impact on the poor, the loss of credibility of the Reserve Bank of India, the push to make India a cashless or less-cash economy, and suggests measures the government could take to rev up the slowing economy. Excerpts:
* Much of the old Rs 500 and Rs 1,000 currency notes seem to have come back to banks, perhaps beyond the government’s expectation. Does this imply a large percentage of black money was converted into new currency notes? Or was it that the government miscalculated the amount of black money in the economy?
The government’s estimate of black money and ours was roughly the same – about Rs...
Esther Duflo, development economist and a professor at the department of economics at the Massachusetts Institute of Technology (MIT), interviewed by Roshan Kishore and Pramit Bhattacharya (Livemint.com)
Economist Esther Duflo on demonetisation impact, role of randomized control trials in policymaking, low priority assigned to health and education in India
New Delhi: India’s demonetisation of high-value currency notes is a dramatic example of a policy announcement made without any serious thought given to implementation, said Esther Duflo, one of the leading development economists of the world and a professor at the department of economics at the Massachusetts Institute of Technology (MIT) in the US.
Duflo, whose research has focused extensively on India, said the real impact of the currency-scrapping gambit may never be known because India’s statistical machinery does not capture data on the informal economy on a regular basis.
Born in France, Duflo studied history and economics at the Paris-based Ecole Normale Supérieure before moving to MIT, where she finished her doctorate in 1999. A few years after finishing her doctorate, Duflo became one of the leading architects of a...
R Nagaraj, an economist and currently a professor at the Indira Gandhi Institute of Development Research in Mumbai, interviewed by Kedar Nagarajan (Caravan Magazine)
On 8 November 2016, Prime Minister Narendra Modi made an announcement declaring that notes of Rs 500 and Rs 1,000 would not be legal tender as a part of his government’s policy to clamp down on counterfeiting and black money. It has been widely reported that this policy would directly impact the real-estate sector, which typically witnesses a significant amount of transactions that are made through cash to avoid taxes. The Economic Times also reported that demonetisation would lead to a reduction of interest rates on housing loans, and consequently, to an increase in investment in the sector in the long-run.
R Nagaraj, an economist and currently a professor at the Indira Gandhi Institute of Development Research in Mumbai, is sceptical about long-term effects of the policy on the sector and its effect on interest rates. Nagaraj is a macroeconomic analyst who has studied the impact of black money on...
Utsa Patnaik, professor emeritus at Jawaharlal Nehru University, interviewed by TK Rajalakshmi
Interview with Utsa Patnaik, professor emerita of economics, Jawaharlal Nehru University. By T.K. RAJALAKSHMI
THE FALLOUT of the decision of the National Democratic Alliance government to demonetise currency of higher denominations has been felt across all sections of people. There are concerns that it will lead to an overall economic slowdown given the acute shortage of currency for industrial and agricultural operations. The impact on agriculture and those dependent on agriculture has been gradually unfolding. Utsa Patnaik, professor emerita of economics, Jawaharlal Nehru University, spoke to Frontline on the devastating impact the decision has had and is likely to have, both in the short and the long run, on people and the economy as a whole. Chances of an economic recovery, she felt, were bleak. Excerpts from the interview.
* It has been nearly three weeks since the government announced its decision to demonetise 500 and 1,000 rupee notes. The impact has...