-Frontline The problem in rural India is not one of too much credit to poor households that leads to debt waivers that damage bank balance sheets, but one of inadequate access to credit from formal sources. IF Reserve Bank of India Governor Raghuram Rajan is to be believed, efforts to help Indian farmers by providing them with cheap(er) credit and relieving them of an unsustainable debt burden only harms them in the...
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Cash transfers can work better than subsidies -Guy Standing
-The Hindu Providing people with a modest basic income instead of subsidies would save public revenue With oil prices falling, it was perhaps a good time to fade out fuel subsidies. All subsidies are inefficient and distortionary, and most are regressive. The same could be said of costly public works schemes as well. By contrast, the debate on direct benefit transfers has moved into a more sensible phase, with the posturing criticism of...
More »Where the frontline is key to the bottomline -Lant Pritchett and Yamini Aiyar
-The Indian Express Prime Minister Narendra Modi has repeatedly promised India "maximum governance". But to get there, the high costs and ineffectiveness of frontline service providers need to be addressed. Take elementary school teachers, for instance. "Complete rest in comfortable conditions" is the description a rather candid elementary education cluster resource centre coordinator (CRCC) in Bihar gave his own job. And it's not just him, it is also how the CRCC describes...
More »Wrong numbers: Attack on NREGA is misleading
-The Times of India Jagdish Bhagwati and Arvind Panagariya, hereafter BP, have argued for phasing out the National Rural Employment Guarantee Act in favour of cash transfers ("Rural Inefficiency Act", ToI, 23 October). It's surprising-and amusing-that two eminent economists have chosen to make a case based on prior beliefs and some sophomoric wordplay ('mis'leading economists), rather than on the available evidence. A survey by one of us of the empirical literature...
More »Re-framing the MGNREGA debate -Yamini Aiyar
-The Hindu Reports that the National Democratic Alliance (NDA) government intends to radically restructure the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) have re-ignited public discussion on the scheme. Since its launch, debate on MGNREGA has been synonymous with ideological contestations on the role of the state and its welfare functions. Inevitably, the contours of the debate have been shrill, leaving little space for an evidence-based discussion on the...
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