Bhagirath Baria

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The Author of this blog has keen interest in understanding Economics and its implications on the Individual and the Economy as a whole. Has been writing articles and analysis of issues that may skip general observation, but exert deep influence on people's lives and their decisions. Discussions and Debates related to conventional as well as non-conventional Economics is done here. The author of this blog doesn't classify himself to any particular School of thought in Economics. He is tilted toward Mainstream Economics, though has keen interest in a few Heterodox schools too. Wishing all the readers a truly enriching experience.

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Rath & Economics by Bhagirath Baria is licensed under a Creative Commons Attribution-NoDerivs 2.5 India License.
Based on a work at www.rathandeconomics.blogspot.com.
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Wednesday, May 18, 2011

The Commercialized God

This essay depicts something very crucial about our society. Recently during a visit to a very well-known religious place, I met God. Yes, indeed I met God. The only thing was I had to pay a lot of money for it which I didn't, now there was no hope of getting a glimpse, just then I was given a route to enter & meet Lord(maybe by the Lord himself!). And I did. During the entire process, I found Economics playing its rules as usual.

1. Some essential Goods('thali' that has flowers, sweets & few more things) had to be purchased. This was not at all mandatory but worshipers considered it a Good practice. Indeed we did. Demand & Supply laws were functioning here too. So also the Scarcity notion.

2. Certain basic services were being sold, the most essential one was that of purchasing few flowers for paying respect to God. We did this too.

Now comes the 'most essential' part; Meeting the Lord face to face. Here I was obliged by a vendor(who was selling scared things & flowers) with an excellent offer. It was to pay him a handsome amount to go through an entrance that takes directly to the main area of worship & no traffic of worshipers would be seen. In Economic terms, Black Economy.

India's Black Economy is a well-known fact & has become too huge to be underestimated. Analysts suggest we already have around 75000-80000 crore Rupees kept in Swiss banks which if brought back to India can help us clear all our debts with the Loan lending International Organizations(such as WB, IMF, etc.). And this is just one component of the phenomenon, not to forget the vast unorganized sector of our nation.

Now, being in such a position to choose an option; I had 2 alternatives:

1. Grab it, Pay some money & Meet God peacefully.
2. Refuse it, Go to the General entrance, Wait for my turn , spend few hours & Meet God.

I chose the 2nd one. Two reasons governed this behaviour of mine & of a few other souls who refused to go for it.

A). Unethical: I believe going to God through an entrance which you didn't get by pursuit but money shall never let you get blessings of God.

B). Black Economy: I know, a small refusal from my side won't remove the Black money that has been generated in this nation & which is being actively deployed to Terrorist networks & other Anti-Social activities but I felt that making a small contribution wasn't a that bad idea. So did so.

Now the question comes, Where is the Commercialized God? Answer lies in the points above itself. The temple is one of the richest in India but still charges some money(around Rs. 50) for entrance to meet, pray & take blessings of the God "who is for everyone & no one's commercial property". Not just this, the instance of Black marketing within the very premises of Temple exemplifies the deep rooted "Moral Poverty" of the people here in our own India.

Charging money for a Thali isn't incorrect but black marketing & charging money to let the worshipers meet their very own Lord is very much incorrect. God cannot be & must not be "sold" to people who shall pay the amount nevertheless. Price Discrimination & Product differentiation, as Economists understand, are not eligible for God's worship, Is it? I agree, these people earn their livelihood through this, but is it a viable answer enough to justify Unethical economic actions? Or simply out it in this way, What will those poor people do who cannot afford paying an amount that equals their day's wage? Does this mean that we must discriminate & let only the affluent or rich pray God peacefully & rest others to take a look at the Idol for a few seconds & that too in a rush?

Economics is very crucial, but using its principle in places of sacred worship is regrettable. What these black marketeers do is they 'attach a high value to worship God peacefully' thus prompting people to pay higher for something that is both illegal as well as unethical.

Also, we see here that First the Demand(D) for entering quickly is higher than Supply(S) of it, thus D>S = Scarcity & in scarcity Prices(P) always tend to go high. And Second that people look at the Opportunity Cost & not the accrual at that moment. Opportunity cost here means that the worshipers always come with a wish(or "mannat" as we may call it). This weighs much higher than the amount that one shall be paying then.

Excellent Economics, but at the wrong place. Do put forward your views/arguments/doubts.

Sunday, May 15, 2011

Why Economics is essential?

Today's era can be termed as the Economic era. This is a blunt & a clear-cut fact. With passage of time, Economies are gaining higher advantage to Societies, making Economic relationships & interactions more essential than before. The institutions, Societies, Culture & Ideologies are all now based upon the underlying inter-related Economic relations.

Every State, Society, Culture & Ideology is today measured by its Economic productivity & not just blind beliefs. The Current political changes in West Bengal, Kerela & Tamil Naidu are a good example of this rising phenomenon of Economic supremacy. When one looks at the current Political situation, Democracy especially Representative democracy is in majority of nations, all these institutions are analyzed today on their Economic performance.

What is essential to point out here is that the importance of Money(herein referred to as purchasing power) has become the corner stone of every life and a means to enjoy even the non-materialistic joys of life, those who consider it(read money) as something not to run before may soon realize that their lives are carved out to attain this very objective!

Economics thus holds a crucial place in every sphere of life where an individual wishes to gain satisfaction. No, I do not attempt to say that it is the 'end' but it is for sure a 'means' to many ends. Measurement of Governments & Ideologies(such as Democracy, Socialism, etc.) is done more on their ability to help people live a better life which otherwise translates into "having required purchasing power". Now this purchasing power theory is a subjective decision & will be different for different people, more for some, lesser for some.

This thus makes it clear that the more materialistic the World grows, the more dominance will be enjoyed & deserved by Economics & that too a Normative(ethical) economics. Governments, Political ideologies & the people governing these institution need to deliver Economic performance & help people gain & foster wealth to remain in power. Do express your views.

Thursday, May 12, 2011

Public Transport: A solution for Fuel conservation

While traveling in a local bus of Surat city, I saw vehicles vehemently moving from here & there. We all have seen this phenomenon called 'traffic', daily in front of us or while being a part of it. Sometimes we might wonder, where do these many vehicles actually go & as such why are so many people traveling at almost any given time of the day? There can be hundreds of answers but my question isn't this. I wonder why do we have a habit of using petrol "so many times" in a single day for a single given route in a city?

The area of concern here is, why do we use petrol so many times to travel on a route for which Public transport is already available , isn't it? Yes, we all have different time schedules & buses do not work according to us but still, just think for a moment, what if number of buses are increased for all routes?

In my limited experience in few metros & tier-II cities of India, I found that local bus services are reasonably good and in cities like Ahmedabad one needs to wait just for a few minutes to get a bus as there are huge number of buses traveling on almost every route. Now, the crux of my discussion. If we reduce usage of personal vehicles & increase the usage of public transport as much as possible, we shall implement following Economics:

1. Reduced usage of Petrol except for those who use for traveling to other cities i.e. highway traveling. This includes Heavy load commercial vehicles, trucks, people traveling to other cities & few more variables.

2. Increased reliance on Public transport thus reducing Expenditure of households, Resulting in higher Real Incomes. Higher real incomes mean either higher savings or higher demand in form of higher spending, both being beneficial to our growing economy.

3. Comparatively reduced demand for Petrol will result in reduced Demand-Supply gap of Petroleum. This means the scarcity will reduce thus lowering the prices of petrol. Even if Prices are increased, it won't affect the Public transport users as that would mean hardly an increase of Re 0.5-1 per KM in fare rates.

4. Here, Government has the lease to increase prices by a more rate as compared to being done currently as Per-capita marginal expenditure shall be low due to high usage of Public transport. This will help the oil companies to reduce their loses as all of them sell Petrol bearing huge loses every year.

Thus it seems to be a good deal to enhance the usage of Public transport but some issues crop in. They are:

1. If City buses are used, what about the interior regions where buses don't reach or can't reach?
Ans.: Auto Rickshaws are a good option here, they do reach interior regions & streets either directly for a single passenger or in sharing. If the distance is mearge, one can walk too. Good for health!

2. What about those who travel on highways? They're not going to reduce the consumption.
Ans.: Yes they aren't, but at least the total consumption is going to reduce as city buses will need a little more to cope up with the increased demand of fuel. Even if they(public transport) start consuming more, as said earlier Fares shall increase by just a few Rupees per km or even lesser. That's much affordable than spending huge amounts almost daily on fuel for personal vehicles with a plethora of allied problems like Parking, Maintenance of vehicles & many more.

Thus, I attempt to put up a logical model of thinking that can help us to conserve more fuel, become more efficient, increase our real incomes, fulfill other important needs & become productive. Above views are completely open to constructive debates & arguments. Do express you views by following the blog &/or commenting.