Saturday, May 14, 2005

How to destroy affluence and create poverty: a case study of West Bengal vs. Maharashtra

may 13th

thanks to reader amrish for forwarding this excellent paper.

as amrish says, west bengal had the worst of all possible worlds: a nehruvian stalinist regime at the center, and a maoist regime in the state. no wonder they're seriously screwed. this is the nehruvian penalty, doubled.

here is the summary of the lahiri paper: the authors (economists with the federal reserve) compared the trajectories of the economies of maharashtra and west bengal, the two wealthiest states at independence, with roughly equal per capita income. between 1960 and 1995, west bengal managed to reduce its per capita income to only 60% of maharashtra's level! the authors show that a) low productivity, b) poorly functioning labor markets and sectoral misallocations are to blame. also, they show high correlation between factors a) and b) and the rise of the marxist vote share! this is a damning indictment.

quote: "west bengal experienced de-industrialization during this period." so much for the rights of the proletariat.

i suggest that this paper should be read in conjunction with the Survey of Chinese Peasants that has been banned in china, and which shows that almost a billion peasants have been enslaved and severely oppressed to provide the funds for the glittering coastal cities in that country. a google search will bring up a number of reviews, if not the text of the book itself.

simple conclusion: nehruvian stalinist/maoist voodoo economics will perpetuate poverty.

prediction: thanks to the nehruvian stalinists in power at the center now, we can expect india's GDP growth rate to head towards their comfortable 'nehruvian rate of growth' of 3% again soon.

6 comments:

Anonymous said...

It is either juvenile tendency, plain blind opposition or lack of better understanding of "history" to call the current Manmohan Singh government Stalinist or Manmohan Singh's earlier record.

I do believe in the main item of the blog post of impact on West Bengal of the communist policies, just not on what you are piling on top it.

Amit C (amit_mlREMOVETHIS@comcast.net)

http://en.wikipedia.org/wiki/Stalin
http://en.wikipedia.org/wiki/Manmohan_Singh

Anonymous said...

The Wiki entry on Manmohan Singh is probably written by Manmohan Singh.

The entry on Stalin is probably written by some wild right-wing American.

These by themselves don't prove anything.

This is not exactly the same as the Nehruvian form of Stalinism practised in India. In India's case, it was not gulags, but mass starvation that killed off millions. But the personality cult is the same.

Anonymous said...

Aha, but to remind as one as of patiently, it was Manmohan Singh and Rajiv Gandhi of The Congress party who kicked off the economic reforms.

But these facts are often ignored and often ignored in the spirit of 'everyone one has right to their own facts'.

Anonymous said...

Note that it was the same Congress Party that presided over economic ruin for 45 years from 1947 to 1991. They maintained the 3% rate of growth. They know how to maintain the 3% rate of growth. Any reform is a temporary aberration, and they eventually go back to the 3% rate.

Anonymous said...

British used "divide & rule" & screwed us for a century.
Commies use "devoid & rule" & god knows how long they will screw around.

Anonymous said...

Excellent study. Specially the fact that the %age of graduates in west bengal reduced owing to "deindustrialization".(indirect relation)

Here's another article which might interest the readers.It is somewhat related , but since it comes from a Congressman, needs to be taken with a pinch of salt.

http://www.geocities.com/nalinaksha/jairam.html

jairam conviniently lays blame on centre (when he wrote this, his party was out of power) & does an over-simplified analysis of the situation.Though i must confess i liked the term EOK.

jai hind