Jaipur: India needs a better opposition which is the heart of any democracy and the ruling party should embrace that to keep it under check, noted economist and Nobel laureate Abhijit Banerjee said here Sunday.
Speaking at a session at the Jaipur Literature Festival (JLF), the 58-year-old India-born American economist said there was no co-relation between the authoritarianism and the economic success.
“You can easily argue that Singapore had a successful dictator and can easily come back and talk about Zimbabwe. We can talk about this ad nauseum… At some level authority is an illusion,” Banerjee said.
“India needs a better opposition. The opposition is the heart of democracy and the ruling party should want a better opposition to keep it under check,” the Nobel Laureate added.
The Indian-American innovative MIT economist, his wife Esther Duflo and Harvard professor Michael Kremer jointly won the 2019 Nobel Economics Prize ‘for their experimental approach to alleviating global poverty’.
Elucidating on the ways to ameliorate poverty, Banerjee said there was no silver bullet, but many silver pallets.
“Poverty, like cancer, is many problems. There are many diseases. Some people are education poor, some are heath poor and some asset poor. You have to figure out what is missing. Trying to solve everything with one action is unviable to work and never does work,” Banerjee pointed out.
Banerjee also challenged the dogma that if the poor people are given money they waste it, become lazy and fall back into poverty. He advocated that the people living in abysmal poverty should be encouraged by giving them assets and freebies.
“There is so much prejudice about the abilities of the poor. Give the very poor some asset. Not lend, but give them an asset. Maybe a cow, some goats or trinkets to sell, then you look what happen to these people after 10 years. They will be 25 per cent richer, they will be healthier and happier. It encourages them to keep trying and they work harder than the people who didn’t get the assets,” asserted the Nobel winner.
“It is sustainable. We have calculated the rate of return on the investment. In India, it is 400 per cent. Net income that it generates is four times the amount you put in. The same experiment was done in Bangladesh for 10 years. It has been exactly the same there,” Banerjee informed.
Banerjee also spoke about the crisis in the banking sector. “We are in a deep cycle. It will take some time to fix things, particularly the banking sector. We don’t have the money to do what China did which was to put the money in the banking sector, write off the loans. We cannot really afford that right now,” he said.
Responding to a question on whether he would accept the post of Reserve Bank of India (RBI) Governor if it was offered to him Banerjee said, “Absolutely not, because to be an RBI governor, you better be a macro economist.” Asked if he could have won the Nobel Prize based in India, he said, “I don’t think so.”
PTI