just some notes from first three chapters of book
• Chapter 1 -Central theme is division of labor.
• Division of labour is there is big organizations also but is not very visible.
• Davison of labour results in proportionate increase in productive powers of laobur.
• Division of labor is difficult in agriculture compared to manufacturing & that is why progress has been slow.
• Three main advantages are – increase of dexterity in every particular workman
• --- saving of time which is lost in passing from one type of work to other
• ----- Invention of great no of machines as someone doing a work repeatedly will device better ways of doing it.
• In the progress of society, philosophy or speculation becomes like any other employment, the principal or sole trade and occupation of a particular class of citizens.
• Chapter 2 – What promotes division of labor
• In civilized society man needs co-operation and assistance of others.
• It is not form benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.
• Nobody but a beggar chooses to depend chiefly upon the benevolence of his fellow citizens.
• It is by treaty, by barter, and by purchase that we obtain from one another the greater part of those mutual offices which we stand in need of, so it is this same trucking disposition which originally gives occasion to the division of labor.
• The difference in natural talents in different men is , in reality much less than we are aware of ; and the very different genius which appear to distinguish men of different professions , when grown up to maturity , is not upon many occasions so much the cause as the effect of the division of labour.
• Chapter 3
• Division of labor is limited by the extent of the market.
• As by means of water carriage a more extensive market is opened to every sort of industry than what land carriage alone can afford it, so it is upon the sea coast, and along the banks of navigable rivers, that industry of every kind naturally begins to subdivide and improve itself, and it is frequently not till a long time after that those improvements extend themselves to the inland parts of the country.
• Nations around the coast of Mediterranean Sea seems to have been first civilized according to authenticated history because of its peculiar geographical location and topographical features.
• Ancient Indians, Egyptians & Chinese limited themselves to inland navigation.
• River should always branch up to give extensive navigation network ( African rivers) and should not pass through hostile nations.(Danube)
•
Monday, January 24, 2011
India in transition : Jagdish Bhagwati
Not review but some points which I noted when I was reading the book long back.
• Morris Cohen – American philosopher
• Peetamber Pant – Planning commission member
• Adam Smith – The theory of moral sentiments
• James mill – History of British India
• Sidney morganbesser – when asked about Mao’s statement that a proposition may be both true and false he said I know and I do not know
• Henri bergson – great advantage of time is that prevents everything from happening at once
• Childhood was discovered in Europe in 13th centur but it became more significant in 16th-17th century. Children were transformed from valuable wage earners to economically useless but emotionally priceless objects
• Herbert Spencer – the ultimate result of shielding men from the effects of follies has been to fill the world with fools
• The worst psychological state to be in is to have a superiority complex and an inferior status – India before 1990
• J lewis – Quiet crisis in India
• Moore – Social origins of democracy and dictatorship
• Selig Harrison – India the most dangerous decades
• Raj Krishna – Hindu rate o growth – 3.5 %
• Reform by stealth – Mrs. Gandhi
• Reform with reluctance – Rajiv Gandhi
• Reform by storm – Narsimharao
• US view
o 1960 – If china succeeds and India does not, other countries will follow that path.
o Honey attracts flies, gold attract diggers and India attracted economists.
• Harrod domar model talks about rate of investment and productivity of capital. For policy purposes productivity of capital was assumed and thus complete emphasis was on accumulation.
• People thought democracies can’t extract savings which totalitarian countries can garner and were thus at inherent disadvantage.
• India did well on rate of saving and investment but productivity of capital was low.
• In late 70s and 80s perceptions were running ahead of the realities both in cas of china and to a limited extent in case of India.
• Perceptions were driven not by remarkable economic performance but by whether the policy framework was changing in the direction of market oriented reforms.
• Rajiv Gandhi’s reforms were aimed at changing the nature of intervention but not at eliminating them.
• There is no simple relationship between democracy and growth rates if cross country regressions are run.
• Authoritarianism seems to be neither a necessary nor a sufficient condition for rapid growth, on such evidence.
• Weak excuse for India’s low growth
• Growth now may at expense of growth later – latin America
• More compared to pre independence
• India is special , eastern economies were small
• India is democratic
• Lack of growth was the reason for India’s failure to eradicate poverty
• There are two routes to ameliorate property : direct help or through growth
o Both should be used unless one is dominant
o Even if direct route helps second is required because it will enable state to take second route
o Till 80’s poverty and growth were treated In isolation and often in opposition
• He does not agree with the claim that economists ignored poverty at the cost of growth I n1950 and 1960 rather he argues they chose a path of growth to ameliorate pverty
• Indian strategy was of active intervention by government and has author calls it “pull up”
• Poverty persisted in India not because there was wrong emphasis on growth but rather because there was little growth
• Poverty goes down in years of good harvest
• Growth may not be not only slow but also distorted if one has autarkic inward looking strategy thus favoring capital intensive industries on labor intensive one
• Did we get satisfactory growth from our investments?
• Low growth resulted from low productivity as savings were always adequate
• Why productivity was low
• India’s productivity suffered from both the oppressive framework above and illiteracy below
o Saving overestimated? –relative prices and quality of capital good
o Income underestimated? –Black economy – it may be more efficient as it escapes inefficiency of formal economy
o Capital directed towards low productive industries
• Agriculture became more capital intensive with green revolution – but even if you expand land diminishing utility comes in picture. Further growth in productivity would compensate for this
• In industrial sector shift towards capital intensive industry – almost all industries had low productivity . A broad based and prolonged phase of total factor product stagnation in Indian industry between 196-70
o Bureaucratic control
• Control on import export product diversification capacity expansion allocation of imported inputs
• If no industrial licensing we will spend resources in producing lipsticks
• This originated from lack of trust in market when scarcities are acute and tasks are challenging and failure to understand that markets in general work better than central planning as resource allocating device
• The argument was that central planning will calculate costs better but they forgot that central planning will not have access to information
• There were theories supporting identifying and guiding the investments to be coordinated
• Indian planners assumed export pessimism and putty clay technology
• India’s misfortune was brilliant economists who could rationalize everything , far east was spared of them
• One purpose was to prevent monopoly or prevention of economic control in few hands but there could be better ways than licensing as licensing inherently helps haves not have nots
• Small scale sector protection - textile was sacrificed for handlooms
• But the attitude to think that growth of large industry will crowd out small industry was misplaced
• Indian industry could neither become competitive worldwide not could it harness domestic market
• Further regional balance approach – further dividing small capcities that were allowed thus losing economies of scale
o Inward looking trade and foreign investment policy
• Manmohan Singh wrote his thesis that Indian export pessimism was unjustified
• Protection in domestic market made it attractive while restrictions disabled Indian firms from competing globally
• This export driven could have broken the limits imposed on industrial demand from natural limits of agricultural growth
• Import control promoted expanding inefficiently as imports were allotted on capacity basis
• Closed foreign trade and high saving made Indian manufacturing capital intensive rather than labor intensive. Thus wage and employment did not benfit from labor intensive export industry
• Restriction on foreign capital impeded absorption of new technology or their incubation
o Large public sector going beyond what is convention and public utilities and infrastructure
• Fabianism supported gradualism than outright nationalization
• Even electricity , telephone , steel , transport were put in public sector i.e. infrastructure thus they also made private sector inefficient
• Overstaffing and workers being paid for overtime
• Policy of taking over sick private units to respond to public pressure
• High wage and salary bill cut down investment on capital goods crating infrastructure bottlenecks further declining productivity of many user industries
• Payment crisis and subsequent conditions imposed by IMF were not alien but were very much required
• Now question was not whether reforms but in what speed with what sequence and with what chance of success
o Failure to spread primary education and literacy
• Protestant asked everyone to read bible ,thus spreading literacy
• Industrial revolution and child labor law
• Caste system in India has made education useless
• What is to be done
• Macroeconomic crisis made necessary microeconomic reforms
• Multiple governments prompted large spending in small time
• Soft state had arrived by 1980 eliminating celebrated macroeconomic discipline
• Civil service failed miserably in raising the alarm
• Low credit rating – so no private borrowing
• Remittance from gulf dried up
• NRI deposits were withdrawn
• Almost negligible FDI
• Diversion of aid from asian and African countries to erstwhile soviet union
• Increased demand in USA for spending on education and social care
• Funds were low so efficiency was demanded
• Even communist and latin American nations had left anti FDI or anti trade stance so environment was changed
o Indira Gandhi’s upbringing and her past political experience made her at best reluctant reformer
o Rajeev Gandhi was first PM to have done honest work outside politics so he knew deficiency of system
o Reforms till date
• Reforms are foreceful and explicit as opposed to earlier time
• Bicycle theory of reform – keep on reforming in different sectors continuously so as to prevent opposition from having a static target
• Both licensing and exchange control had to go as they were interlinked
• There was support for two step – first mak domestic industry used to competition and then open it but india had no choice in matter
• Rather than import tariff or export subsidy devaluation is better ???
• Promiscuity is easier than marriage and flirting with convertibility was done rather than full account convertibility
• FDI – from arm’s length technology transfer to cultivating direct equity investments
• Impostition of hard budget and competition will make PSUs efficient
• Public sector works on premise that given scarcity of jobs it is bad enough to find one job in a lifetime and to ask people to find two is nothing short of cruelt
o Why reform will stay
• Nothing succeeds like success
• It should not be growth driven by exceess borrowing like latin America
• Domestic market alone can’t attract FDI
• Play Japan card
• In gulf war Japan finance USA instead of giving money to poor Asian nations
• Rajiv Gandhi was not clear that reforms are needed to fight poverty . he seemed to be just fascinated
• Reforms are not prelude to laissez faire but move to productive intervention
•
• Morris Cohen – American philosopher
• Peetamber Pant – Planning commission member
• Adam Smith – The theory of moral sentiments
• James mill – History of British India
• Sidney morganbesser – when asked about Mao’s statement that a proposition may be both true and false he said I know and I do not know
• Henri bergson – great advantage of time is that prevents everything from happening at once
• Childhood was discovered in Europe in 13th centur but it became more significant in 16th-17th century. Children were transformed from valuable wage earners to economically useless but emotionally priceless objects
• Herbert Spencer – the ultimate result of shielding men from the effects of follies has been to fill the world with fools
• The worst psychological state to be in is to have a superiority complex and an inferior status – India before 1990
• J lewis – Quiet crisis in India
• Moore – Social origins of democracy and dictatorship
• Selig Harrison – India the most dangerous decades
• Raj Krishna – Hindu rate o growth – 3.5 %
• Reform by stealth – Mrs. Gandhi
• Reform with reluctance – Rajiv Gandhi
• Reform by storm – Narsimharao
• US view
o 1960 – If china succeeds and India does not, other countries will follow that path.
o Honey attracts flies, gold attract diggers and India attracted economists.
• Harrod domar model talks about rate of investment and productivity of capital. For policy purposes productivity of capital was assumed and thus complete emphasis was on accumulation.
• People thought democracies can’t extract savings which totalitarian countries can garner and were thus at inherent disadvantage.
• India did well on rate of saving and investment but productivity of capital was low.
• In late 70s and 80s perceptions were running ahead of the realities both in cas of china and to a limited extent in case of India.
• Perceptions were driven not by remarkable economic performance but by whether the policy framework was changing in the direction of market oriented reforms.
• Rajiv Gandhi’s reforms were aimed at changing the nature of intervention but not at eliminating them.
• There is no simple relationship between democracy and growth rates if cross country regressions are run.
• Authoritarianism seems to be neither a necessary nor a sufficient condition for rapid growth, on such evidence.
• Weak excuse for India’s low growth
• Growth now may at expense of growth later – latin America
• More compared to pre independence
• India is special , eastern economies were small
• India is democratic
• Lack of growth was the reason for India’s failure to eradicate poverty
• There are two routes to ameliorate property : direct help or through growth
o Both should be used unless one is dominant
o Even if direct route helps second is required because it will enable state to take second route
o Till 80’s poverty and growth were treated In isolation and often in opposition
• He does not agree with the claim that economists ignored poverty at the cost of growth I n1950 and 1960 rather he argues they chose a path of growth to ameliorate pverty
• Indian strategy was of active intervention by government and has author calls it “pull up”
• Poverty persisted in India not because there was wrong emphasis on growth but rather because there was little growth
• Poverty goes down in years of good harvest
• Growth may not be not only slow but also distorted if one has autarkic inward looking strategy thus favoring capital intensive industries on labor intensive one
• Did we get satisfactory growth from our investments?
• Low growth resulted from low productivity as savings were always adequate
• Why productivity was low
• India’s productivity suffered from both the oppressive framework above and illiteracy below
o Saving overestimated? –relative prices and quality of capital good
o Income underestimated? –Black economy – it may be more efficient as it escapes inefficiency of formal economy
o Capital directed towards low productive industries
• Agriculture became more capital intensive with green revolution – but even if you expand land diminishing utility comes in picture. Further growth in productivity would compensate for this
• In industrial sector shift towards capital intensive industry – almost all industries had low productivity . A broad based and prolonged phase of total factor product stagnation in Indian industry between 196-70
o Bureaucratic control
• Control on import export product diversification capacity expansion allocation of imported inputs
• If no industrial licensing we will spend resources in producing lipsticks
• This originated from lack of trust in market when scarcities are acute and tasks are challenging and failure to understand that markets in general work better than central planning as resource allocating device
• The argument was that central planning will calculate costs better but they forgot that central planning will not have access to information
• There were theories supporting identifying and guiding the investments to be coordinated
• Indian planners assumed export pessimism and putty clay technology
• India’s misfortune was brilliant economists who could rationalize everything , far east was spared of them
• One purpose was to prevent monopoly or prevention of economic control in few hands but there could be better ways than licensing as licensing inherently helps haves not have nots
• Small scale sector protection - textile was sacrificed for handlooms
• But the attitude to think that growth of large industry will crowd out small industry was misplaced
• Indian industry could neither become competitive worldwide not could it harness domestic market
• Further regional balance approach – further dividing small capcities that were allowed thus losing economies of scale
o Inward looking trade and foreign investment policy
• Manmohan Singh wrote his thesis that Indian export pessimism was unjustified
• Protection in domestic market made it attractive while restrictions disabled Indian firms from competing globally
• This export driven could have broken the limits imposed on industrial demand from natural limits of agricultural growth
• Import control promoted expanding inefficiently as imports were allotted on capacity basis
• Closed foreign trade and high saving made Indian manufacturing capital intensive rather than labor intensive. Thus wage and employment did not benfit from labor intensive export industry
• Restriction on foreign capital impeded absorption of new technology or their incubation
o Large public sector going beyond what is convention and public utilities and infrastructure
• Fabianism supported gradualism than outright nationalization
• Even electricity , telephone , steel , transport were put in public sector i.e. infrastructure thus they also made private sector inefficient
• Overstaffing and workers being paid for overtime
• Policy of taking over sick private units to respond to public pressure
• High wage and salary bill cut down investment on capital goods crating infrastructure bottlenecks further declining productivity of many user industries
• Payment crisis and subsequent conditions imposed by IMF were not alien but were very much required
• Now question was not whether reforms but in what speed with what sequence and with what chance of success
o Failure to spread primary education and literacy
• Protestant asked everyone to read bible ,thus spreading literacy
• Industrial revolution and child labor law
• Caste system in India has made education useless
• What is to be done
• Macroeconomic crisis made necessary microeconomic reforms
• Multiple governments prompted large spending in small time
• Soft state had arrived by 1980 eliminating celebrated macroeconomic discipline
• Civil service failed miserably in raising the alarm
• Low credit rating – so no private borrowing
• Remittance from gulf dried up
• NRI deposits were withdrawn
• Almost negligible FDI
• Diversion of aid from asian and African countries to erstwhile soviet union
• Increased demand in USA for spending on education and social care
• Funds were low so efficiency was demanded
• Even communist and latin American nations had left anti FDI or anti trade stance so environment was changed
o Indira Gandhi’s upbringing and her past political experience made her at best reluctant reformer
o Rajeev Gandhi was first PM to have done honest work outside politics so he knew deficiency of system
o Reforms till date
• Reforms are foreceful and explicit as opposed to earlier time
• Bicycle theory of reform – keep on reforming in different sectors continuously so as to prevent opposition from having a static target
• Both licensing and exchange control had to go as they were interlinked
• There was support for two step – first mak domestic industry used to competition and then open it but india had no choice in matter
• Rather than import tariff or export subsidy devaluation is better ???
• Promiscuity is easier than marriage and flirting with convertibility was done rather than full account convertibility
• FDI – from arm’s length technology transfer to cultivating direct equity investments
• Impostition of hard budget and competition will make PSUs efficient
• Public sector works on premise that given scarcity of jobs it is bad enough to find one job in a lifetime and to ask people to find two is nothing short of cruelt
o Why reform will stay
• Nothing succeeds like success
• It should not be growth driven by exceess borrowing like latin America
• Domestic market alone can’t attract FDI
• Play Japan card
• In gulf war Japan finance USA instead of giving money to poor Asian nations
• Rajiv Gandhi was not clear that reforms are needed to fight poverty . he seemed to be just fascinated
• Reforms are not prelude to laissez faire but move to productive intervention
•
Friday, January 21, 2011
Movie review : fanaa
Really stupid.Full of over acting, clichés and lots of factual and cinematographic inaccuracies. 1.Railways at udhampur is recently made how some 5-6 yrs back kajol could board it. 2.The overacting by AMir Khan as tour guide washes his past reputation specially all the 2 take ki poetry he does. 3.A very clichéd character of guard at delhi. 4.Tyagi she was supposed to be a psychiatrist but is present in all operational decisions and in Indian authorities women are really not involved in this kind of things.Even celebrated Kiran Bedi was traffic superintendent. 5.Most laughable thing was Nuclear missile part, which never has a simple trigger kind of thing and what on earth that trigger was doing in some forward base in Kashmir. 6.While trying to be politically correct terrorists are shown fighting both India and Pakistan which is a rubbish.Terrorists are supported by Pakistan and their major demand is accession to Pakistan and not freedom. 7.They copy the scene from James Bond movies of fight in ice field but never shows a front shot of Amir Khan. 8.House interior and costume of characters never show that they are in midst of a snow struck region. 9.Kashmir doesn't have snow storm obstructing everything for 15 days it happens in Antarctica. 10.it is ridiculous to think govt will leave the pursuit of terrorist and don't do a house to house search while they had an encounter with such a deadly terrorist ,similarly his terrorist friends should also have come earlier. 11. I never knew Gulmarg is that close to Srinagar. 12.Scene of amir Khan singing in kitchen with kajol is direct lift from Dil hai ki manta nahinh but thr it was more graceful.
movie review : Chak de India
Refreshing because girls are shown to be fighting for themselves no one else and Shahrukh has resisted temptation of overacting. Shilpa Shukla was terrific as Bindiya while kamal chautala was also good. Preeti sabarwal had stony face. Hockey officials were quite realistic and i was amazed to see girls playing decent hockey as normally in Indian sports movie they never show front shot of the players. No doubt Australian location was used to its best. Editing is good but at some places screenplay leaves a lot to be desired. One puzzling thing was girls are not shown practicing on AstroTurf. Secondly Indian hockey team now a days is only Jharkhand-orissa and Punjab-Chandigarh with one or two from manipur. Tribal girls of orissa and Jharkhand have come up like anything in this sport and credit goes to tata academy.
Do dooni char
Was flipping through channels on Sunday night after having nothing better to do and saw this wonderful movie do dooni char. Captured essence of middle class life so succinctly and reminded me of my childhood. Best was ending of movie when narrator (daughter of protagonist) claims that consumerism is not bad. In family's desire to buy a car they could rediscover their dad, started taking pride in their lives and his brother and father came close to each other. Their effort to win lucky draw by opening thousand boxes of detergent reminded me of how dutifully mom was collecting each edition of local newspaper when they had a maruti draw or how I used to try KBC phone religiously in college. Typical middle class dreams and desire to fulfill them. How one has societal pressures of showing one in good position in marriage at one's relatives, how neighbors fight and learn to live together and how old teachers always live in heart of students.
some trivia..
1. neetu singh appears in movie after long. her lament as she was not allowed to do job, how she tried small tricks for family honor, how she goes with her husband when things come to a passe.
2. street smart daughter who is also narrator ..aware of financial limitations but has apsirations..
3. neighobours
4. and finally risihi kapoor himself...a lower middle class person forced to do things due to rising consumerism in society.
his constant refrain that I am not a failure...is too touching.
some trivia..
1. neetu singh appears in movie after long. her lament as she was not allowed to do job, how she tried small tricks for family honor, how she goes with her husband when things come to a passe.
2. street smart daughter who is also narrator ..aware of financial limitations but has apsirations..
3. neighobours
4. and finally risihi kapoor himself...a lower middle class person forced to do things due to rising consumerism in society.
his constant refrain that I am not a failure...is too touching.
Movie review : Khosla ka ghosla
my imdb review
Story is Indian . Many people in west will find it difficult to relate with it and secondly and most importantly narration is also Indian unlike those art films which have Indian story but present it in western way making it very fake and similarly rahul bose style movies which present western stories in Indian way.
In addition to main plot various sub plots like career vs family vs love choice, or life of people who are sidekicks of main players ( both builder and theater troupe leader) , life of retired middle class people and their aspirations and how they are unable to make system work for them and have to find their own solutions.
overall a great movie with good acting by all casts
but later when I think movie is too simplistic. it is good to laugh at but highly unrealistic. it is next to impossible to get a fair deal from a simple broker who helps you in getting a house on rent and here we are talking about a proper real estate dealer.
but most hilarious and poignant are movements when old man and his friend share fundas of life and when they actually please with everyone politician, police, NGO etc to get back their property..
A black comedy sort of..
Story is Indian . Many people in west will find it difficult to relate with it and secondly and most importantly narration is also Indian unlike those art films which have Indian story but present it in western way making it very fake and similarly rahul bose style movies which present western stories in Indian way.
In addition to main plot various sub plots like career vs family vs love choice, or life of people who are sidekicks of main players ( both builder and theater troupe leader) , life of retired middle class people and their aspirations and how they are unable to make system work for them and have to find their own solutions.
overall a great movie with good acting by all casts
but later when I think movie is too simplistic. it is good to laugh at but highly unrealistic. it is next to impossible to get a fair deal from a simple broker who helps you in getting a house on rent and here we are talking about a proper real estate dealer.
but most hilarious and poignant are movements when old man and his friend share fundas of life and when they actually please with everyone politician, police, NGO etc to get back their property..
A black comedy sort of..
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