T C A Srinivasa-Raghavan: Sorry for the interruption

OKONOMOS

Two weeks ago I asked an economist to name 15 economists who do microeconomics research in India. He was able to count only eight.

This column is taking a short break. This is the 500th article in this series, which was conceived in order to bring Indian economics research to a wider audience. The first few articles, therefore, carried a note at the bottom asking Indian economists to point out such unpublished research to Business Standard. Nothing happened, absolutely nothing.

This suggested that economists didn't read business papers. The suspicion was confirmed when Rakesh Mohan asked me to help out with something at NCAER. Subsequently, I found this to be true of other think-tanks as well. Economists were engaged in what they regarded as policy research but without having a very clear idea of what was actually going on in the real economy. Most of them had strong opinions that ignored the finer details. Nor did they seem to care very much.

I tried to tap the Delhi School of Economics also but only two or three papers surfaced. Then I tried the Indian Statistical Institute. But their research was too full of mathematical economics to be of much use for policy issues. I tried the IIMs, NIPFP and a host of other institutions, with pretty much the same result. In recent years, though, the RBI has become very good. Partly, the problem was that Internet dissemination had not been as fully developed as it is now. But mostly it was because empirical research had become sporadic, and what little there was, tended to be a recounting of the tables as text. It wasn't very good and certainly not enough to sustain a column of weekly reviews.

When I asked my economist friends why they were such lazy sods, they said data was hard to come by. As alibis went, this one was hard to beat: no data""no research, no research""no data. I complained about this to my niece who teaches economics in an American university. She said I should look up the NBER and other American sites. These turned out to be veritable goldmines. But soon enough, three things became clear.

One, since the data was entirely American, the research was mainly of entertainment value for Indians. So for five years I did what I could to keep readers amused.

Two, only the macroeconomic research on these sites was of interest to India. But it suffered from a deep and, in my view, fatal flaw, namely, the disastrous failure by economists to recognise that macroeconomics is an instrument of politics. You can't have the Keynesian identity without the G in it and if you have G, it is the surrogate for politics. Economists get around this problem by saying it is autonomous. Also, as a result of not factoring in politics, or what is the same thing, the timing and quality of interventions, macroeconomists never seemed to be able to agree on anything. I thought, why confuse the reader any more than he already is.

Third, as Subir Gokarn, an economist and columnist on this paper, pointed out when I griped to him about it, the availability of data sets for pretty much everything meant it was possible to run regression even on the bowel moments of apes, provided of course it was time-series data.

It was becoming clear that economics had begun to resemble Vedic discourse during the Gupta period in the 5th and 6th centuries "" arcane, pointless and ultimately, self-destructive. I can claim to know because for every article I have written, I have had to read at least five research papers. Other things also became clear, such as mainly citing your friends in a round-robin way because it matters how many times you are cited; not citing anything much that was more than five years old; making very little effort to tie in the data with the theory; sticking to the current orthodoxy so that you conform; and so on. Most crucially, I realised that very little non-sponsored industry or firm-level research is done in India. In consequence, government policy is still made in a virtual vacuum or, even worse, because of lobby-power.

Two weeks ago, at a leading institution in Mumbai, I asked an economist (who said microeconomic research was thriving in India) to name 15 economists who did it. He slowly counted till eight and then became irritated with me.

For these and other reasons, after almost a decade of continuity, this column is taking a much-needed break. It will try to return in a few weeks with a focus on microeconomics.

And, as when we started, here is an appeal: let me know if you know of such research.