"Did we do the right thing?"

[layperson]

Originally Posted by Kabir
Sorry Shahriyar, I have a good friend with spelling Shahriar. That's why make that mistake...need to pay more attention in your case now

Its all good!!!! I am a bit weird in this sense regarding my name.
I was just messing with you though.

[PoorFan]

Originally Posted by Kabir
Miya...amio to Shahriar er motoi kotha bollam. Amare winner er podok dilen na ken? Arr khelbo na

PS: This is typical Bangali shobhab...I'm just one in the bunch.

Sorry Kabir, you people are posting so many posts here in FC, it's really hard for people like me to read all that fast! And I promise, next time I shall declare you the 'winner', and yes no matter what!

[Arnab]

Is this 'inequality' rising only because of 'liberalization and globalization'? or just because of govt policy making failure?

Well, embracing liberalization and globalization is also part of government policies.

There must be other variables & terms like population birth rate, death rate, environmental change, disaster, international market ( oil, food, technology etc. ), international politics ( war, embargo etc. ), and may be many other things? Since these terms can change the cost ( in a short term ) of daily commodities and daily life so rapidly, the percentage of inequality may appear more rising and significant than old days.

Yes, all those variables factor into this. But also note we are not talking about short-term inequality. And I am not sure what you mean by "inequality" here either. It's certainly not what I think when I think of the economic term "inequality".

Here's the kind of definition of Inequality I have in mind:

"Economic inequality refers to disparities in the distribution of economic assets and income. The term typically refers to inequality among individuals and groups within a society..."

Besides, since life style is going to be more 'convenient' and costly in a rapid way, 'water system', 'decent housing' and 'good education' naturally get more costly, hence inequality appears here also.

Well, strictly speaking, inequality like this has been around all the time. We are considering whether this has increased in India.

Finally, how should we explain that without this high growth rate of India ( because of 'liberalization and globalization' ) would have caused 'less inequality' in their society?

Theoretically,

a) if the incomes and assets acquired by India during this high growth period were distributed among the Indian population in the previous unequal manner (just like it), then the inequality would have remained the same.

b) if the incomes and assets acquired by India during this high growth period were distributed among the Indian population MORE unequally than in the previous unequal manner, then the inequality would increase. In fact, this is what's happening in India right now.

c) if the incomes and assets acquired by India during this high growth were distributed among the Indian population less unequally (or more equally) than in the previous unequal manner, the inequality would have decreased.

One thing I can imagine, without this 'liberalization and globalization', India, China or even Bangladesh would be as much happy as those 'central asia country' is now. There might be less 'internal inequality' but the gulf of 'external inequality' ( xxxx vs world ) definitely exist ( of course not because of 'globalization' ), which they might have to face sooner or later, but in a hard and long way.

Alright, this is getting pretty vague and out of scope. I'd rather not comment.

In that sense, as long as India achieving high growth rate, decent position in world market and technology ... India is in right track at least.

Sure, but that's being on the right track in achieving different goals. But probably not on the right track in poverty alleviation. High growth rate, decent position in world market and technology, etc are not quite directly correlated to poverty alleviation.

If it is the question of govt. policy making on reducing poverty ... there must be always some room to improve.

Obviosuly. The room has gotten bigger in fact, with the inequality having risen over the decades, as the Gini Index shows.

[PoorFan]

Well, embracing liberalization and globalization is also part of government policies.

Original comment was "it has been steadily rising after the advent of liberalization and globalization". And my stand is ... rising inequality is not only because of globalization but also because of other variables.

Yes, all those variables factor into this. But also note we are not talking about short-term inequality. And I am not sure what you mean by "inequality" here either. It's certainly not what I think when I think of the economic term "inequality".

I was also talking about short-term inequality ( that's why in my previous post I said "considering the huge / rapid change in globe last couple of decades" ), and by inequality I meant income & wealth.

Here's the kind of definition of Inequality I have in mind:

"Economic inequality refers to disparities in the distribution of economic assets and income. The term typically refers to inequality among individuals and groups within a society..."

I have no problem to accept that, though I was not aware of that detail, but I said that 'proper distribution policy may have room for develop'. And those variables surely affect this Economic inequality too.

Well, strictly speaking, inequality like this has been around all the time. We are considering whether this has increased in India.

Yes, but drastic change in currency and price should be taken in consideration too, compare to the old days. And yes I think this ( inequality ) has increased in India ... wait ... not only India I think.

Theoretically,

a) if the incomes and assets acquired by India during this high growth period were distributed among the Indian population in the previous unequal manner (just like it), then the inequality would have remained the same.

Not sure ... perhaps her needs during this high growth got changed compare to the scale of old days, such as national security, power & other resource development, infrastructure development, science and technology development, Education development and may be many more. It's not realistic to expect a steady 'previous unequal manner' since so many variables that get changed and get prefered time to time.

b) if the incomes and assets acquired by India during this high growth period were distributed among the Indian population MORE unequally than in the previous unequal manner, then the inequality would increase. In fact, this is what's happening in India right now.

For those reason I said earlier, increasing inequality can not be described simply as "distributed MORE unequally than in the previous unequal manner".

c) if the incomes and assets acquired by India during this high growth were distributed among the Indian population less unequally (or more equally) than in the previous unequal manner, the inequality would have decreased.

Would have or would have not decreased, but they might have short coming in other developments, if they had to put high priority on inequality.

Alright, this is getting pretty vague and out of scope. I'd rather not comment.

IMPOV, it's not 'vague and out of scope', and I feel lucky since your 'no comment' helped me not to explain further.

Sure, but that's being on the right track in achieving different goals. But probably not on the right track in poverty alleviation. High growth rate, decent position in world market and technology, etc are not quite directly correlated to poverty alleviation.

Yes, on the right track in achieving so many goals in ( Indian ) priority basis, not only for poverty alleviation. And Yes, those are 'not quite directly correlated to poverty alleviation', that's why the term 'in a long run' or 'consider after 15 years' came to this discussion I think.

Obviosuly. The room has gotten bigger in fact, with the inequality having risen over the decades, as the Gini Index shows.

Though I believe inequality has risen over the decades, but I doubt globalization and high growth rate is only the reason, rather I believe it will help India in a long run to reduce poverty and inequality.

Ohhh god! what a long post it has become at the end.

[Arnab]

Originally Posted by PoorFan
Original comment was "it has been steadily rising after the advent of liberalization and globalization". And my stand is ... rising inequality is not only because of globalization but also because of other variables.

Sure. The author thinks there's a major correlation between the advent of liberalization and globalization in India and the rising inequality in the country. Major enough to single them out. You think the author is implying direct causality. But I don't think he is doing that. And yes, there are more variables that can contribute to the rising inequality.

I was also talking about short-term inequality ( that's why in my previous post I said "considering the huge / rapid change in globe last couple of decades" ), and by inequality I meant income & wealth.

Well, I am considering long-term inequality.

I have no problem to accept that, though I was not aware of that detail, but I said that 'proper distribution policy may have room for develop'. And those variables surely affect this Economic inequality too.

But proper distribution policy not quite a measurable quantity as assets and incomes. But Economic inequality is generally defined in terms of assets and incomes, and it makes sense to keep it simple like that.

Yes, but drastic change in currency and price should be taken in consideration too, compare to the old days. And yes I think this ( inequality ) has increased in India ... wait ... not only India I think.

I am sure it has all been taken into consideration.

Not sure ... perhaps her needs during this high growth got changed compare to the scale of old days, such as national security, power & other resource development, infrastructure development, science and technology development, Education development and may be many more. It's not realistic to expect a steady 'previous unequal manner' since so many variables that get changed and get prefered time to time.

Sure. That was a theoretical possibility. Economy is always in a flux, nothing's constant.

For those reason I said earlier, increasing inequality can not be described simply as "distributed MORE unequally than in the previous unequal manner".

Oh yes it certainly can. That's how it's defined in the discipline of Economics. Ceteris Paribus of course.

Would have or would have not decreased, but they might have short coming in other developments, if they had to put high priority on inequality.

Why "would not"? The way economic inequality is defined, if things are distributed in a more equal manner, inequality diminishes, simple.

You are right that economic factors are tied to each other and one affects the other in various manners, but when I am presenting these theoretical scenarios, I am assuming "all other factors are unchanged". Otherwise it's hard to build ANY theoretical argument in Economics. In economics they metion the latin term "ceteris paribus" to mean this.

IMPOV, it's not 'vague and out of scope', and I feel lucky since your 'no comment' helped me not to explain further.

I think it was pretty vague and out of scope. So I will not continue on that.

Yes, on the right track in achieving so many goals in ( Indian ) priority basis, not only for poverty alleviation. And Yes, those are 'not quite directly correlated to poverty alleviation', that's why the term 'in a long run' or 'consider after 15 years' came to this discussion I think.

And along with that came into the discussion the questions about what someone means by "in the long run" and why "consider after 15 years"? No satisfactory answers were given.

Though I believe inequality has risen over the decades, but I doubt globalization and high growth rate is only the reason,

Well, nobody has called high growth rate or globalization as the only cause of poverty. So I think you misread something somewhere?

rather I believe it will help India in a long run to reduce poverty and inequality.

It's very hopeful of you to "believe" that, but the stats say otherwise.

If the long run is defined as 15 years starting right now, most of the poor people in India currently aged above 40 will die as poor persons before seeing any decrease in inequality.

Since we are already in the second decade of India's economic growth, we can assume that a generation of poor people has already died while remaining in poverty AND their next generation is currently living in a more unequal India.

[Kabir]

Originally Posted by PoorFan
Sorry Kabir, you people are posting so many posts here in FC, it's really hard for people like me to read all that fast! And I promise, next time I shall declare you the 'winner', and yes no matter what!

This is like Bangladeshi politics...golar jor diye je bole, shei winner. Hahaha. Thanks bro.

[Special 1]

Originally Posted by PoorFan
No it's not. Bush is not an Iraqi whereas Indian people on their own making the policy, Bush forced the plan of democracy whereas Indian people implementing their plan on their own will ( or wish ), Iraqi people getting killed / destruct by war whereas Indian economist and politicians are working hard for their country growth, which may helping ( someway ) increase 'inequality'. Is it comparable in term of 'forget' between Iraqi people killing / destruction and 'inequality' in Indian society may caused by higher growth or globalization?

IMO, 15 years or not, poverty, as well as inequality is bound decrease in a long run, as long as economy grows, and proper distribution policy has to be taken to make it fast. India is in right track or not in term of 'proper distribution policy' may be debateable. But If african nations had at least half of Indian or Chinese growth in economy, more than half of worlds poverty and inequality may have decreased I guess.

You are disillusioned my friend. Indian people are not implementing their plan on their own will fully. They are a part of a global economy, hence they are more vulnerable to what other people want. Not to mention WB and IMF and their SAPs.

In the long run this inequality does not have to decrease. Proper distribution policies, according to neoclassicals hinder growth rate and will not be implemented. ALso, by transfering money from the rich to the poor you are taking away teir digninty, the only thing they have. It gets compicated. (Read Sens and yunus's work). A well planned economic growth process can achieve both. After all the WB nw realises taht economic equality actually helps growth.

FInally, AFrica does not have a lot of people. China and India do. So, they contain most of the worlds poor. Higher growth rates in Africa will not reduce half of worlds povety

[Special 1]

http://video.google.com/videoplay?do...0239&q=sainath
This has three parts go to google video and search sainath.
This will give you a clear picture of how India is doing.

[PoorFan]

Sure. The author thinks there's a major correlation between the advent of liberalization and globalization in India and the rising inequality in the country. Major enough to single them out. You think the author is implying direct causality. But I don't think he is doing that. And yes, there are more variables that can contribute to the rising inequality.

Well, I am not an economist, can not debate correctly whether it is major or not. What I feel other variables also have significant role increasing inequality. For example ( which bothers me most ), think about the oil price in 1990 before Saddam & Bush senior start the war in Iraq, and what was the price after war? and even now? The oil price got higher more than twice in a few years! lot of people lost job who used to work in middle east too. Significant change in oil price bring significant price change in every element of economy, but peoples income remain almost same or even some people loses job thanks to those war!

And if it happens as fast and in a short term as we experienced in last 15 years, this variable ( war ) seems to have major role in increasing inequality too ... says my common sense not economy though.

Well, I am considering long-term inequality.

Looks like I misread you here.

I am sure it has all been taken into consideration.

Yes, may be using some kind of constant number, though I wonder how they summed up those variables and how reasonable they are, You economist people must know better than me.

Sure. That was a theoretical possibility. Economy is always in a flux, nothing's constant.

What I meant was ... a country like India's needs can get changed as well as preference in other sector ( in that period ), other than focusing on inequality.

Oh yes it certainly can. That's how it's defined in the discipline of Economics. Ceteris Paribus of course.

I don't know really ... Does discipline of Economics define how much money a country like INDIA should spend for national security? power & other resource development? infrastructure development? and others? that I mentioned in last post? If it does than you are right, though I wonder how it's possible and feasible, my ignorance.

Why "would not"? The way economic inequality is defined, if things are distributed in a more equal manner, inequality diminishes, simple.

Because, there might have short coming in other development sector, which may caused slow growth, less revenue, less money for investment, less economy activity ... and as a result at the end, inequality might not diminish that simply as the formula of economics suggest.

You are right that economic factors are tied to each other and one affects the other in various manners, but when I am presenting these theoretical scenarios, I am assuming "all other factors are unchanged". Otherwise it's hard to build ANY theoretical argument in Economics. In economics they metion the latin term "ceteris paribus" to mean this.

According to economics may be I am totally wrong, and I agree with "it's hard to build ANY theoretical argument in Economics" without assuming "all other factors are unchanged". That means we still don't know for sure ( other than theory ) how it would worked for real in case of India, if she had put high priority on decreasing inequality, cutting fund from other development sector.

And along with that came into the discussion the questions about what someone means by "in the long run" and why "consider after 15 years"? No satisfactory answers were given.

There is no satisfactory answer for that you can expect, though at least 1 generation was in my mind. There is no satisfactory answer either if you throw out globalization ( major cause as you said ) and concentrate on decreasing inequality. You may have some formula in economics which may bring us some numbers of years, but then again they all are just numbers which may well differ from reality.

Well, nobody has called high growth rate or globalization as the only cause of poverty. So I think you misread something somewhere?

Answered in 1st comment in this post.

It's very hopeful of you to "believe" that, but the stats say otherwise.

If the long run is defined as 15 years starting right now, most of the poor people in India currently aged above 40 will die as poor persons before seeing any decrease in inequality.

Since we are already in the second decade of India's economic growth, we can assume that a generation of poor people has already died while remaining in poverty AND their next generation is currently living in a more unequal India.

You are quite right on your 15 years calculation, considering other factors are all remain constant. Though I put my hope on the fact of 'growing middle class' generation. Means 'lower class ( income )' people are shifting towards 'middle class', and people in 'poverty' or barely above poverty is / will be shifting towards 'lower class ( income )'. May be that's why both India and China preferring on high growth, globalization, competitive, strong economy, even being aware of poverty and inequality. Aren't they looks as hopeful as me too? But the stats say otherwise! yeah.

And yes, govt. should develop as much as they can in proper distribution, keeping their economic growth in track ( IMO ).

[PoorFan]

Originally Posted by BBgun
You are disillusioned my friend. Indian people are not implementing their plan on their own will fully. They are a part of a global economy, hence they are more vulnerable to what other people want. Not to mention WB and IMF and their SAPs.

Well, unfortunately can not agree with this logic. Globalization is there for a long time, and will remain now on, with some additional rules or restriction whatever. It's not sound logical ... saying we are playing football not on our will, but because we are just happened to be a part FIFA or AFC. Some pressure does exist there, but all are part of the game.

In the long run this inequality does not have to decrease. Proper distribution policies, according to neoclassicals hinder growth rate and will not be implemented. ALso, by transfering money from the rich to the poor you are taking away teir digninty, the only thing they have. It gets compicated. (Read Sens and yunus's work). A well planned economic growth process can achieve both. After all the WB nw realises taht economic equality actually helps growth.

More or less agree with this part.

FInally, AFrica does not have a lot of people. China and India do. So, they contain most of the worlds poor. Higher growth rates in Africa will not reduce half of worlds povety

I said poverty, not poor, don't know exact number though, but assumed nearly half of poverty people live in Africa.