In defence of Amartya Sen

At a hall inside Delhi’s Jawaharlal Nehru University, there’s only room to stand. Scholars, students, journalists and professors struggle to fit in. Some of them are comfortable squatting on the floor, as they take copious notes.

Others crane their necks to connect with the speaker on stage. It’s the Nobel Prize-winning Harvard economist Amartya Sen. Economists anywhere seldom command such appeal outside the hallowed precincts of their campuses. In his homeland, Sen is a celebrity, mobbed like movie stars.

Popular among left-liberals, Sen has been equally respected across the political spectrum. In 1999, he was awarded India’s highest civilian honour, the Bharat Ratna (Jewel of India), by a government led by the right-wing nationalist Bharatiya Janata Party.

Unlike his periodic visits home, Sen’s tour of India last month to launch his new book An Uncertain Glory, India and its Contradictions, co-authored with Jean Deréz, created quite a stir.

In the span of three weeks, the differences between Sen and Jagdish Bhagwati, a Columbia University professor of economics, have metamorphosed from the academic to the political, and then perhaps, turned a tad personal.

The duel is a throwback to the no-less-vicious showdown between economists John Maynard Keynes and Friedrich von Hayek, which gripped Britain’s academia 80 years ago.

Sen is no stranger to “bizarrely drawn” academic battle lines. When he moved to Trinity College in 1953, Cambridge was dominated by a polarized debate between the Keynesians, such as Nicholas Kaldor and Joan Robinson, and neo-classicists, such as A.C. Pigou (see Sen’s Nobel Biographical for more on this).

Sen found “Kaldor” to be the most tolerant among the neo-Keynesians, while Richard Kahn was the most “bellicose”. But the bellicosity of Bhagwati has been far more pugnacious.

The current clash was triggered by a review of Sen’s new book in the venerable columns of The Economist magazine.

The reviewer of Sen’s book credited Bhagwati and his collaborator Arvind Panagariya with advocating reforms to achieve faster growth and poverty reduction. However, the reviewer lauded Sen and Drezé for aiming to go “much further” (in improving living conditions).

In a letter published in the magazine, Bhagwati took a swipe at this, saying he was “puzzled” over how far Sen could possibly go because he had been offering only a “lip-service” to growth.

Reductionist Bhagwati found the lavish praise of Sen out of place because every thing about human development and greater social good had to be about a number called gross domestic product.

Sen, of course, had to “correct” Bhagwati. “On the contrary, the importance of economic growth as means – not an end – has been a theme in my earlier writings (including Choice of Techniques in 1960 and Growth Economics in 1970),” Sen wrote in his rebuttal published in the magazine.

It barely needs saying that growth is one of the most important economic indices of a country. India rightly has been focused on achieving high rates of gross domestic product, which is, loosely, the sum total of all goods and services produced by a country.

The official target is 9% overall, which is made easy if the agriculture sector clocks 4% or thereabouts.

India’s growth has been phenomenal, although it has considerably cooled, slowing to a decade’s low of 5% in the year to March 2013. Between 2005 and 2008, real GDP growth was about 9%, one of highest globally after China.

Sen made the cardinal mistake of pointing out that all this growth has not been matched by an equal improvement in basic living conditions of a vast majority of Indians and, along with aiming for high growth rates, it might be worth paying attention to health, nutrition and schooling etc of the poorest Indians.

While Sen has never underestimated the importance of market-led growth, he places greater emphasis on redistribution, although he denied using this term in this sense. His has strived to go beyond standard economics to enter the realms of philosophy and identity.

Bhagwati and Sen have gone on to work on very different fields. As a career economist, Bhagwati has worked on the role of free trade and globalisation in improving incomes, which is a significant milestone in itself.

However, Sen’s preference to ‘formally’ work on welfare economics and human deprivation has been misrepresented – by Bhagwati – to be anti-growth.

Bhagwati has advocated a ‘growth-first, redistribution-later’ model, which is why he is enamoured of the so-called Gujarat model of development. However, he leaves unexplained a “puzzling” scenario.

Despite being an enterprising business-community-led state awash in capital, Gujarat’s social indices remain very poor.

Bhagwati should perhaps also throw light on how exactly a poorly fed, ill-clad and under-skilled labour force can generate growth?

Acknowledging Bhagwati’s economic genius, it must be said that he is far less tolerant of Sen than the latter is of the former. His recent views on Sen are no more than rant.

Could growth alone be the answer to deprivation, which is multidimensional? Poverty, or more specifically income-poverty, is an economic construct, whereas inequity is a social construct.

Indeed, in a country with a significantly huge population who are poor, where a rigid “caste system” and “narrow identities” can actively contribute to “economic unfreedom” — to borrow a phrase from Sen — the state will always be compelled to provide a modicum of support and action.

Grappling with the challenges of development in a nation steeped in poverty, one woefully lacking in infrastructure and in food output after roughly two centuries of colonial rule, India had never known the “luxury of being sweet sixteen”, as Nehru had said about war-ravaged Japan.

Although it is disturbing to see how the Indian government frittered away its impressive growth rates, or failed to address stark social inequities, the broader official goalpost of “inclusive growth” is a fairly laudable concept.

In contemporary political-economy history, few governments have made participatory growth their singular motto.

It will not be out of place to compare the India of today to a patient on the path to recovery but still in need of nursing and care. To remove the oxygen mask at this delicate stage would be to cut off crucial life support.

For example, could India have left the job of universal immunization to the markets or deferred it till future economic growth emerged?

Without state action in the area of compulsory immunization, India’s life expectancy at birth would have stagnated at 40 years or so at the time of Independence. It is 66.1 years now. See here.

The markets did not eradicate polio either in the US or lately in India. Government action did. There are some businesses the government should not be in, like running airports. But in others, its role is not just critical, but irreplaceable.

The same is true of education. As people move up the income ladder, private schooling becomes the preferred choice (given the Hindustan Times’s largely middle- to high-income readership profile, nobody reading this blog will have a child attending a government school).

But not funding school education will leave little incentive for millions to send his or her child to school.
Bhagwati’s charge that Sen’s prescriptions of state-directed services in critical sectors such as health and education as “dangerous” is as much fallacious as hypocritical.

The Columbia professor, as indeed most neo-liberal economists of his ilk, seldom direct their intellectual anger towards state subsidies in western countries, most notably in the US, which has refused to eliminate agricultural subsidies declared illegal at the WTO. (Another Nobel winner, Joseph E. Stiglitz has more on this here)

Sen has had to face a far sterner reproach from India’s hard right than he did from his thesis guide at Cambridge, the celebrated Joan Robinson, who had censured Sen for “not being quite true to the new orthodoxy of neo-Keynesianism”.

A right-wing MP called for revoking Sen’s Bharat Ratna for not endorsing Modi.

Sen had to admit – when pressed a second time by a TV interviewer – that he did neither approve of Gujarat chief minister Narendra Modi as a potential prime minister or considered Gujarat as a paragon of economic virtue, as Bhagwati thinks. He did, however, say that there are lessons to be learnt from Gujarat’s high growth.

However, India would much rather do with a secular prime minister, he said.

Sen’s idea of welfare economics is closely linked to his view of tolerance.

Hatred can fatally result in “economic unfreedom”, as he had learnt as a young child growing up in Dhaka. Kader Mia, a Muslim daily labourer, was “knifed” during a sectarian clash.

He had to venture into a hostile Dhaka locality in search of work, despite being advised against it by his wife. He could have remained in the safety of his home if he had the luxury of skipping a day’s work. Intolerance can be a dead-end and curb economic and other freedoms.

The incident made Sen deeply aware of the “dangers of narrowly defined identities”, a theme he took up later in his Identity and Violence, The Illusion of Destiny.

Not surprisingly, he would not have someone who strikes fear among India’s minorities as India’s prime minister. Only free societies, after all, can make economic progress.

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