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Tag Archives | Public Policy

Geopolitics, economic reforms and the citizen

By Nitin Pai for Loksatta Whistle.

Let us be clear: the world is interested in India because our economy is growing. If the growth process stalls, the world will stop seeing India as a potential solution to its problems. It is important that the world sees us positively this way because that, in turn, creates an environment conducive for our own growth and development.

So, getting back onto a high growth path is as much a foreign policy imperative as it is a development policy goal. Economic power can be converted into military power, knowledge power, cultural power and other forms of power.

India in 2015 has a short window of opportunity to avail of a virtuous cycle of positive demographics, shifting global balance of power and the economics of development. If we miss the bus, it might be several decades before we get another chance.

This is why the goal of completing the process of economic liberalisation is important. It is also why the task of reforming the government to make the Indian state more competent is important. It is wishful to believe that either of these goals can be achieved by a citizenry that is narrowminded, parochial, illiberal and chauvinistic.

If economic and governance reforms are in the domain of political leaders, personal reforms are very much in our own hands. Can the politically awakened Indian citizen hold fast to the enlightened values enshrined in our Constitution? Let’s use the opportunity to reflect on this.

Author is co – founder and director of the Takshashila Institution, an independent think tank and school of public policy.

This piece was first published in Loksatta Whistle.

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The eightfold path to unlearn public policy paradigms

What are the eight things to unlearn in order to appreciate policymaking better.

by Pranay Kotasthane (@pranaykotas)

If one wishes to learn about public policy in the Indian context, there are several great pieces to refer to. For instance, Ajay Shah’s blog post Become a public policy thinker in three easy steps or Nitin Pai’s The eightfold path to transforming India are great starting points. However, as someone newly initiated to this field, I am interested in finding out what we need to unlearn in order to appreciate the intricacies of public policy. And based on my observations there are eight paradigms to let go of. This eightfold way of liberating oneself is given below, arranged in no particular order.

Paradigm 0: What I know is golden, so I can’t let go of it.
The zeroth step of course is being open to the process of unlearning. We come with our own biases, shaped by our varied experiences and perceptions. But our experience or knowledge is not be the way the entire world functions. An unrelenting hold on what we have learned is the equivalent of the sunk cost fallacy in economics.

Paradigm 1: Good intentions translate to good policies.
I defer to an inexact analogy here. Good motive is like the potential energy of a stone resting on the edge of a cliff. The stone has the capacity to get work done by virtue of its position. A good policy on the other hand is like kinetic energy of this stone falling off the cliff. Kinetic energy is the capacity to get work done by virtue of motion. Similarly, a good policy has the capacity to get things moving towards the desired outcomes. Just as both forms of energies have the capacity to get work done, good intentions and good policies also have the capacity of accomplishing objectives in public policy. But this by no means implies that they are same. Conversion of potential energy to kinetic energy requires a conservative force to act on it.  Similarly, good intentions need lots of conscious effort before they are ‘converted’ to a good policy. Moreover, the stone resting on a cliff also has the potential to kill if it falls on an unsuspecting passerby below. Similarly, good intentions alone can lead to negative externalities and even lead to an erosion of moral values. For example, the Morarji Desai government in 1977 ordered a prohibition on alcohol with the ‘good’ intention of improving the health of the citizens. But this ban turned out be a disastrous policy, leading to deaths due to spurious liquor, and the subsequent rise of organised crime like smuggling and money laundering, all having roots in the black market of alcohol. So good intentions does not equate to good policies.

­­­­Paradigm 2: The codes of morality that apply within a nation-state should also apply to the conduct between nation-states.
Trying to figure out the ethical dimensions of a US attack on Iraq or Afghanistan is a moot question to ask because the rules of the game differ according to the context. The morality of a nation-state within its boundaries is in most cases, based on a document like the constitution which every citizen and the government is expected to adhere to. A deviation from the principles of constitutionalism is thus considered wrong or inimical to the interests of the nation as a whole. On the other hand, the rules of the game that apply to international affairs and geopolitics are completely different. There is no constitution or a written code of conduct here. Instead, the fundamental law which applies to international relations is that of power.

Paradigm 3: India’s bane is that while the policies are good, their implementation is bad.
A policy that does not envisage its implementation is, in fact a poor policy to start with. Though one needs to discount the time scaling challenge that all governments face, a policy that remains oblivious to the implementation aspect is no good either.  The word implementation is often seen in terms of enforcement capacity and perceived stakeholder attitudes, two variables which are both prima facie known (even if not accurately) before a policy is made. Thus, a policy that does not envisage the role of these factors is by definition an incompetent policy.

Paradigm 4: Certainty and consistency of views over a long period is a hallmark of good policy analysis.
Stephen Walt, professor of International Relations at Harvard University has written a brilliant piece where he offers the Top 10 things he was wrong about and admits to a change in mind on these matters.  Such humility and lack of certitude is, in fact a boon for policy makers. If empirical evidence proves otherwise, one must replace their deeply held beliefs. And as some great economist (allegedly Keynes) once claimed — “When the facts change, I change my mind. What do you do?”

Paradigm 5: Economics is about picking your poison—capitalism or socialism.
Economics is the bedrock of good policy making. It is the science behind the practice of policy making. The subject, at its core, seeks to understand the study of human behaviour. Economics is certainly not about eulogising the patron saints of economic theories, whether it is Karl Marx or Adam Smith. As long as our efforts are aimed at substantiating why, and how human beings behave, we can aim to have policies that can build the right incentives, nudges or restrictions. Being wedded to an economic theory in the face of contradictory evidence is repeating the folly described in Paradigm 4.

Paradigm 6: A government should be target all its energies at the most disadvantaged section of the society.
More often than not, change happens at the margin. For example, economic reforms initiated in the early 1990s greatly improved the lives of many people in India. But these reforms helped people at the margin — the ones who had access to at least one of three things — money, education or skill. The reforms could not substantially turn around the lives of sections which had none of the three prerequisites. A government can change the lives of many more people at the margin with a lesser effort. This certainly does not mean that governments should ignore those below the margin, but it is equally improbable to expect rapid changes with a one-dimensional strategy. Let the best not be the enemy of the good.

Paradigm 7: What works for me works for everyone else.
Difficulties of perception and memory lend themselves to different cognitive biases to different people. Not all people see the world in the same way and hence do not respond to the same incentives as I do.

Paradigm 8: Politics is a contestation for ideological dominance.
Ideology is just one of the many factors that shapes political opinions. A better definition of politics is that it is a contestation for narrative dominance. It is thus not surprising that it is often the narrative that wins before a party or person does. And since politics is a contestation for the dominance of a narrative rather than an ideology, those who are stuck in ideological silos often end up having egg on their face.

This, I submit is the eightfold path to unlearn and liberate oneself from the bondage. And this in my opinion is the entry point into the world of policy making.


Pranay Kotasthane is a policy analyst at The Takshashila Institution. He is on twitter @pranaykotas

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