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Showing posts from October, 2020

What's in a Name?!

- October 29, 2020

“Whats in a name?” is usually attributed to Shakespeare. Yet in the name lies the identity of the character, identity of the place, identity of the person and more. It is for a name that agents fight. Noted economist Stephen Levitt dedicates an entire chapter on naming preferences in his best seller Freakonomics. To him Levitt, name is an aspiration and perhaps manifests a response to an incentive. Parents’ name their children after their role model, one whom they seek to emulate. The name of successful character is what is sought to be named to many a kids born in their era. Names undergo a change with passage of time. If the names denoting God and Goddess dominated the Indian landscape for many years, it is the modern trends and the names associated with these trends that dominate the current era. A part of Pakistani problem in identifying with terror is something decoded through the names the parents keep their children in that country. In fact, the naming trends indicate several

Presumptive Loss and Price Discrimination

- October 28, 2020

The Delhi High Court is hearing the appeals of the Union of India against the acquittal of all the accused in the notorious 2G scam case. Among those in the dock are DMK leaders like Kanimozhi and A. Raja the then Union Minister. The hearings on these appeals are likely to get over by early November with the judgment likely to be out by the end of this year. The political ramifications of the judgment would no doubt be felt. Given the approaching elections to the legislative assembly in Tamil Nadu, the opposition DMK would sitting on razor’s edge awaiting the judgment. In some ways, if the accused are convicted, this could have certain implications for the succession planning within the DMK. DMK might be in an advantageous position going into the elections, but an adverse judgment might derail its plans. Incidentally in some quarters, the current hearings are being viewed in the context of the hard bargaining that might be going on between the DMK leadership and the ruling BJP at the

Mathematics, Tharoorisms and Prisoner's Dilemma

- October 26, 2020

A few days before, came across an interesting tweet. This tweet is available here . The tweet links to an article that talks about jargons and their usage in everyday life. The author in the article points out that research indicates, the use of jargons at every second instant reflects a case of insecurity and not academic learning or competence. Therefore, one would wonder, why people resort to jargons and high sounding words at the drop of the hat. Of course, people like Shashi Tharoor or Manish Tiwari seemed to master that. Therefore, it would be pertinent to decode the logic behind using Tharoorisms so as to speak in the everyday life. If one goes further, there is a tendency among the social scientists to increasingly resort to mathematical formalism of late. Interestingly, the mathematical formalism only makes the concept more complex than demystifying it. Unless the goal is to make the concepts or language complex, there seems to be no reason why one should use it. Yet peopl

Economics and Signalling: Beauty and Ownership of Durables

- October 25, 2020

There is without doubt a fascination in many to look or appear beautiful or handsome. They want to score one up over their family members or friends or those in the social circle. There is no doubt an attraction towards spending on beauty products like cosmetics or dresses. There is further an attraction towards owning latest electronic gadgets, a keen inclination to own a car or at least a two wheeler, an innate desire to own house preferably in an upmarket belt, a tendency to possess and wear jewellery different from the rest. All these are instances which one observes around them in everyday life. To some it might be a necessity, to some it might be an aspiration, to others it might be fulfilment of desire to square up with their prospective rivals so as to speak. Yet in each of these actions or movements towards those actions, underlies a concept that is innate to economics. While as perceived from outside, economics might appear abstract, but as the explanation for these phenome

Economics Applications- Examples from Intellectual Property Rights

- October 24, 2020

Many past posts have discussed the applications of economics concepts and principles in different facets of life. It has been argued often that the applications are perhaps sub conscious but nevertheless can be theorized. There are often applications that can be theorised through economic thinking while rationalising those actions. The current post will seek to delve into the intellectual property rights (IPRs) and how their application gets rooted in economics. While IPRs need an engagement at depth, the current post will limit to a few examples that highlight the economics at work. Ever-greening of patents In 2014, the Supreme Court of India invalidated the patent on Gilvea, the anti-cancer drug developed and marketed by Novartis. The patent on the drug had expired in 2006 but the pharma giant wanted to extend the patent. It had made use of the application of the concept of ever-greening. Patents are an outcome of a trade-off between short term and long term prospective rew

Kashmiri Pandits, Thedor Herzl and the Aliyah

- October 21, 2020

Nothing is more shameful nor agonising than a community being driven out of their homes and find themselves in refugee camps in their own country. They are not in refugee camps for a few days but for years together. While the Internally Displaced Persons (IDPs) is something not acceptable for at least democracies, the case of the Kashmiri Pandits stand testimony to the abdication of the Indian state. Perhaps their only crime was they were Hindus. On January 19 1990, posters sprung up everywhere in the Kashmir valley calling for the Hindus to leave the valley. There were announcements over the loudspeakers through the night threatening the lives of the Hindus. The state had completely collapsed. Jagmohan had taken over as the Governor the previous day, but the administration had completely turned against India. Left with no options, the Kashmiri Pandits had to flee from Kashmir and begin lives afresh in the refugee camps of Jammu and Delhi. Their tragedy was turned into an insul

The Hindu Rights Awaits its Gandhi

- October 20, 2020

There is a constant debate in the social media on how left has monopolized the intellectual and cultural public sphere. Furthermore, there is a strong stream of liberal thinkers or at least so-called liberal thinkers who strive to have their voice as the monopoly in the public sphere. Without doubt, many have been patronized by the Congress led ecosystem that ruled the country for a significant part of the decades post-independence. There have been non-Congress dispensations yet they have shied away from taking on the powerful lobbies. Some attempt was made in the intellectual sphere or the social sciences sphere by Dr. Murli Manohar Joshi as HRD minister during the NDA rule from 1998-2004 but it was undone the moment the Congress came back to power. Given the liberal secular chatterati which is very vocal and thus entrenched, the scope for the challenger is often diminished. The emergence of social media gave a new impetus to the growth of the Indian right. The voices on the r

Jan Bhagidaari, Signalling and Bottom of Pyramid Entrepreneurial Creation

- October 19, 2020

In the presence of information asymmetry, it is difficult to gauge the intentions of the opposing party. The only way to detect any possible moves is through a careful observations of the signals they are likely to send. Thus signalling is of critical import in economics. In the past posts, the role of signalling has been discussed in certain contexts. The current post would seek to take it forward. Recently there was a communication from the RBI Governor to the players in the debt market be competitive and not combative to achieve the best results. There is a tendency in the section of debt players to act pro-cyclically in tune with RBI whereas the others might act counter-cyclically to the RBI stance. This often negates the RBI purpose and thus monetary transmission might not achieve the desired results. This of course in some ways reflects the tragedy of commons often discussed in economics literature but owes its origin to biology. Yet in discussion on signalling, two dimen

Narendra Modi and the Reforms

- October 17, 2020

Sometime back, the post “ Decoding Modi’s Popularity ” tried to understand the reasons for continuing popularity of the Indian Prime Minister. Many western commentators try to judge him on their standards which implied would translate into so-called western liberal values. Thus in their assessment, he stands contrary to what they seem to preach to Indian masses. Yet while his popularity remains undisputed, there are many commentators including among the Indian right and his support base who feel that Modi is not an economic reformer. They point out to the lack of reforms in the Indian context. They argued that Modi while create political disruptions has faltered on the economy. The low economic growth rate in the recent periods is seen as an vindication of their stand. Yet, at times it feels for an economic reformer in the Indian context, all Modi had to do was to privatize Air India and close down BSNL. To a prospective champion of Indian economic reforms, the test begins with priva

Constitutional Originality and Indian Liberals

- October 14, 2020

In the United States, the Senate hearings on nomination of Judge Amy- Coney Barrett is of course evoking a strong and passionate debate. The timing is what it matters. The intelligentsia on the Democrat side prefer waiting for the November 3 elections before the nomination happens. If Judge Coney Barrett, gets confirmed, the Supreme Court will be heavily weighing in favour of the Conservatives. The Democrats, if they win the elections, can propose to increase the strength of the Court, yet it is about the adjudication of any disputes that might arise in November 3 elections that gives a strong edge to the Republicans in the judiciary. There was an interesting article by Cass Sunstein in Bloomberg Judge Coney Barrett. The article is available here and Sunstein’s tweet on this is available here . There is an interesting response by noted economist Oliver Blanchard to the tweet of Sunstein. The response tweet is available here . The article and the tweets around that article centre a

China, India and Afzal Khan

- October 13, 2020

The winter is seemingly setting in Ladakh yet there seems to be no end in sight for the standoff that has ensued since April this year. The Chinese forces are digging in and reinforcing. Ditto for the Indian forces. The mind games are truly on. Similarly, the Indian forces have taken control over series of peaks hitherto unoccupied and overlooking the Chinese positions. If it was believed China had occupied the strategic heights in the early part of the summer, as the winter sets in, it seems Indians have occupied strategic heights in some other sectors. While the game might moving towards a Prisoner’s Dilemma, yet no one wants to be the ‘Chicken’. It seems a game to the finish. It is unlikely that the game will have any other ending other than the fight to the finish in the long run. The current standoff are more an exercise of preparation for the final war. It is about buying time for the final preparations. The long negotiations are aimed at wearing down the enemy. Each side does

Economics in Real Life- Government Interventions and Economics

- October 12, 2020

In the past, many posts have sought to demystify economics in terms of its applications to real life. Economics at subconscious level and at conscious and deliberate level does affect human decision making as illustrated numerous occasions in the past posts. The current post too is a continuation of the same and seeks to take further the real life applications of economics. In this post, there would be discussion on government interventions and economic decision making of the agents. Many a times the government has to intervene to direct the micro agent behaviour into a trajectory it desires. The finance minister has announced a special LTC cash voucher reimbursement scheme for the block 2018-21. Under the scheme, the employees can opt for this scheme in lieu of LTC for the said block. This might make sense since those employees who have not availed of the LTC might opt for this scheme. Many employees would not perhaps avail the concession owing to the current situation. In some wa

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