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Industry : Management & Strategy Consulting Functional Area : India
Activity:  4 comments  66 views  last activity : 03 12 2011 18:29:31 +0000
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Why do we Protest more in the Indian Economy

The other day I heard in the street a protest announcement in progress against governments frivolous handouts to big business houses. The poor fellow like almost all Indians don’t know the worthlessness of such protests, since ones bread and butter comes out daily from the activities the big business houses perpetuate. I could recognise that it is purely a displaced aggression, a psychological object transfer where the people involved duly transferred their object of persecution that is the economy not in a position to channelize the forces in a way that is conducive to their existence. The jobs they have, the activities they undertake infact  all the events in an economy has direct impediments on the events the investment community led by the business houses here in India does.

So the solution lie in which they should know is to channelize  the economic forces in rightful directions rather than make it go helter-skelter so that it become of no use to any citizen like it has been happening here in India since independence.

The right channelling of economic forces take shape when the government decides to direct their policies depending on the macro economic ‘circular flow model of the economy’. The model consists of four boxes with a fifth box. The four interconnected boxes as 1)the government 2)the household3)manufacturing4) the intermediation means banking and 5)the markets. They boxes are called the ‘sectors’ of the economy rather than the deluded version spreading around here as the different type of manufacturing and services which are divisions of each sectors.

The transitory functions are the government directs regulations, welfare, social insurance at the household and the reverse flow from household to government is taxes. Similarly the flow from government to manufacturing is regulation and taxes flow back ward from manufacturing to government. Household transit to manufacturing by way of investments and employment flows backward from manufacturing to households. Households transits to Banking by savings being placed with banks and banks transit backward by way of interest rates. Banks transit to manufacturing by way of credits and manufacturing which are companies and corporate put their savings through reverse transition into banks from whose deployment they make their wealth criterion met.

So when these transitions are visible in an economy they tend to be lesser protests and better welfare, productivity which is wealth generation for the nation, transparency, better believable journals, efficiency for the economy.

This is just the starting point for designing a sovereign economy and from here the macroeconomic policies can be designed based on gaming the economy through game tools like ‘extensive form graphs’. This creates more fore-see-ability for the economy and citizens choices made out for rationality  pays off and the economy will be on a path to more moral outcomes which is what less trouble for citizen means.

 

 Top Comment : NATTERAJA R. ARIKRISHNAN   | 03 11 2011 17:05:57 +0000
Wonderful article Mr.Mathew Cherian Ji. In India, our elected governments have no political will to stream line the economic development policies through proper distribution channels.Even if they plan for the long term benefit basis it has got derailed at some stages due to the reasons best known to the administrators. Above all the policies designed towards the welfare of the people have not been fully implemented and everything aims at the vote bank politics to satisfy the vested interest of the certain section of the echelon in our society. The staging of demonstration and protests in the roads leads to loss of money/productivity only but at the same time the protesters choose this option to register their concern or grievances in our democratic country. What they can do other than this. However, the protests can not be the answer and it will not resolve the issues. Our govt and even everybody talks about inclusive growth, but we see in the reality side.
 
4 comments on "Why we protest more "
  Commented by  Rathin Deb, Business Alliances Manager, Tower group of companies    | 03 12 2011 18:29:31 +0000
Thanks Natteraja for referral.Yes it a good article and makes interesting reading
  Commented by  kasturirangan.r, Consultant, videocon industries limited    | 03 12 2011 02:47:06 +0000
Thanks Mr.NatarajaR.Arikrishnan;
Protest if at all like Japan,where they have unique way of protesting,like wearing black badges,if it were to be a manufacturing shoe co,that will not affect the company;they will be producing the left pair only and once the issue is resolved the right pair will be produced without affecting the poduction schedule.What ever said and done the crux of the solution lies in legitimacy.In any case the people can change the Govt. once in 5-Years or before through no confidence4 motion in a democratic and secular country like India and U.S.A;TWO OF THE WORLD'S LARGEST DEMOCRATIC STATES.
Or we can have a maximum of 2 to 5 recognized political parties to have a effective say in the Parliament or Representation based on the votes polled by the individual M.P'S proportional representation .However as a Business Model stated by Mathew Cherian
will work if the Govt too works in tandem in line with the sound Business Principle.A Point to be noted from Japan and now China the Reserves Of a country and Bank Balance of an individul only speaks in the Globalised Economy.
The Populist measures like Robbing the Richand pay the Peter i mean the Govt does this
political Juxtapose by waiving of farm loans free electricity subsidiy though it may be populist measures but ultimately the debt of any country is carried by every citizen of that country.
  Commented by  Mathew Cherian, Research Associate/Analyst, Western Michigan University    | 03 11 2011 17:55:44 +0000
Mr. Nattereja, I am not saying protest is wrong in democracy, it is a 'checks and balance' for the economy and they should resort to it whenever they feel the situation is 'uncanny', but then it is their responsibility too to study the problem properly and address the protests or whatever strategies they employee, in more efficient manner than act like mentaly stunted people where the information they carry is lopesided and the solution they seek is like the solution Kalidasa was trying to do before enlightnment.

Uncanny situation exists in the nation may be due to the economic policies derived is based on no sound principles for long time may be even from independence.
Few years back in an annual issue of Indian Today they published excerpts of the authbiography of Mahanoblis, our first planning commission chairman. When Nehru contacted him he was doing his PHD in mathematics at Cambridge, and he told Nehruji that he had no idea what planning is all about anyway he came on his insistence. Then when he didn't know where to start they found out on search that Russia had central planning and Nehru despatched him to Russia to learn central planning. He came back with the five year plan strategy a subject on which he had no academic or skill bearing per se then.
 This is our heritage. One can imagine all those who got trained under him experience they gained from secondary sources. What I am trying to say is our approach to economy running had been lopesided and may be we are changing in the globalised settings and probably we need to scale it up to some theories well founded philosphies of economics like the 'circular flow model' to start with. Thanks for the learned reply.
  Commented by  NATTERAJA R. ARIKRISHNAN, AREA SALES MANGER, UNIFLEX CABLES LTD    | 03 11 2011 17:05:57 +0000
Rating : +1 
Wonderful article Mr.Mathew Cherian Ji. In India, our elected governments have no political will to stream line the economic development policies through proper distribution channels.Even if they plan for the long term benefit basis it has got derailed at some stages due to the reasons best known to the administrators. Above all the policies designed towards the welfare of the people have not been fully implemented and everything aims at the vote bank politics to satisfy the vested interest of the certain section of the echelon in our society.
The staging of demonstration and protests in the roads leads to loss of money/productivity only but at the same time the protesters choose this option to register their concern or grievances in our democratic country. What they can do other than this. However, the protests can not be the answer and it will not resolve the issues. Our govt and even everybody talks about inclusive growth, but we see in the reality side.
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