Decision Making as Output and Bounded Rationality

  The classical economics theories proceed on the assumption of rational agents. Rationality implies the economic agents undertake actions or exercise choices based on the cost-benefit analysis they undertake. The assumption further posits that there exists no information asymmetry and thus the agent is aware of all the costs and benefits associated with the choice he or she has exercised. The behavioral school contested the decision stating the decisions in practice are often irrational. Implied there is a continuous departure from rationality. Rationality in the views of the behavioral school is more an exception to the norm rather a rule. The past posts have discussed the limitations of this view by the behavioral school. Economics has often posited rationality in the context in which the choices are exercised rather than theoretical abstract view of rational action. Rational action in theory seems to be grounded in zero restraint situation yet in practice, there are numerous restra

Bihar Elections 2020- A Note

 

The last phase of Bihar elections are about to be held on November 7, 2020. The counting of votes will happen on November 10, 2020. Along with these elections the counting of by-elections in several states for their Assemblies will also be held. The most interesting part of this election was Bihar going to polls in mere three phases. This represents the journey Bihar has travelled over the years. It was not long when Bihar polls would be full of violent incidents, people dying in clashes. Mercifully, the current round of elections have gone peacefully. In fact, the peaceful conduct of polls in three phases in an environment aggravated by the pandemic unleashed by the Chinese virus represents a case for India to move towards a single or two phase polls in the near future.

 

Amidst these elections, the pointers from Madhya Pradesh would no doubt be significant. While the BJP might win absolute majority, if it does fail to win significant number of seats it would herald a sort of comeback for the Congress besides a signal for decline in the hold of Jyotiraditya Scindia. The elections in Manipur too would point to the stability or otherwise of the ruling BJP in the state. it might be sort of curtain raiser for the 2022 assembly elections in Uttar Pradesh. Gujarat’s vote would perhaps reflect the state’s tolerance or otherwise of Congress leaders jumping ship. But usually bye-elections do not point to significant portends barring few circumstances. Therefore, it would be without doubt, the eyes would be on the Bihar elections, the largest exercise being conducted in the shadow of COVID-19 anywhere in the world.

 

Many observers believe the electoral verdict is a foregone conclusion. Having said that, to borrow from cricket, elections too are a game of glorious uncertainties. Nothing would be definitive so as to speak till the last vote is counted. Therefore, it would be pertinent to have a look at the scenario as it stands in the elections. Bihar of course has been politically vocal. A typical Bihari is politically conscious yet the voting figures in Bihar do not normally reflect that. The current percentage in voting too stands below 60% something similar to past elections. The shadow the Chinese pandemic might also be a factor in the relative lacklustre voting. The battle is between the two major alliances, the NDA represented by BJP and JD(U) while the opposition UPA is represented by an alliance of RJD, Congress and the left parties including CPI, CPI(M) and CPI(ML). there is also a third force, the LJP contesting in the JDU seats but supporting BJP elsewhere. There are other minor formations like RLSP, BSP, JAP among others that are trying their luck in the hustings.

 

On paper, the ruling NDA seems to be sitting pretty and likely to score a relatively easier victory. Yet, the fatigue with Nitish Kumar is something that cannot be missed. Most observers are indicating a sort of an anti-establishment wave against Nitish. Therefore, they believe that Nitish’s seat would shrink and fall perhaps even below RJD. Yet while there is an apparent fatigue, Nitish cannot be underestimated. Time and again, he has proved his support among women for his prohibition policy and the Mahadalits and extreme backward classes for his reservation policy. These sections are likely to continue backing him. The fatigue is more visible among those BJP supporters who are tired of Nitish’s repeated volte-face. They might look towards Chirag Paswan’s LJP. Many believe that LJP is propped up by the BJP to rein in Nitish. It must be observed how this party would perform. Both BJP and JD-U have left a few seats each to minor players. It must be said given the past precedent these seats are as good as lost.

 

Meanwhile, RJD is handicapped by the absence of its founder Laloo Prasad Yadav currently in prison after conviction in the fodder scam. His sons Tejasvi and Tej Pratap are leading the battle from the front but their inexperience might be a handicap. They have attracted crowds leading to speculation of a RJD hawa of sorts but the crowd typically is of Yadavs and Muslims, their traditional votebank. Furthermore, the party is troubled by the weak links of its alliance partner the Congress. The Congress at the moment seems to be a burden on the alliance rather than a catalyst to diversify the vote base. The left parties barring CPI-ML have lost influence over the years and might remain also ran.

 

The BJP seems to be performing very well as per the ground reports. It is perhaps evident and undisputed that BJP will emerge as the single largest party in the elections. It must be seen whether BJP with LJP and other minor players are able to hit the majority mark thus enabling it to form the government independent of JD-U. Yet, it is unlikely that BJP will opt to form the government and is likely to continue with Nitish. The obvious reason would be the signals it would send to other parts of the country especially Maharashtra where its alliance partner dumped it for CMship. It is not that BJP would perpetually continue with Nitish but at the moment irrespective of the performance, BJP might not ditch Nitish.

 

The smaller parties continue to contest numerous seats but their reach is limited. While Upendra Kushuwa or Pappu Yadav or even BSP or Owasi might claim to have votebanks, past evidence doesn’t project optimism towards them. They might be vote-cutters in a few seats here and there but unlikely to make any damage to the mainstream parties. The independents and rebels might make noise but their damage is likely to be in very few seats. These become important only when there is a cliff hanger and not a relatively easier election.

 

While the opposition would want to see these as referendum on Modi government, it is unlikely to be one. If the NDA wins, without doubt, it would be the BJP which would have pulled it through and thus the credit must go to Modi. In case of defeat, it is the Nitish fatigue that would be responsible and could not be countered by the Modi counter offensive. All said and done, though the verdict might be a foregone conclusion, the elections as with any other one offers fascinating moments for the observers and analysts alike.

 

 

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