Viksit Bharat through 'useful knowledge'

Last week, Joel Mokyr, Philippe Aghion, and Peter Howitt were honoured with The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. Mr Mokyr has argued that societies flourish when they nurture, develop and spread “useful knowledge”, among other things. Mr Aghion and Mr Howitt explain how such knowledge can be highly productive when it unleashes competition, destruction and regeneration. Together, they elucidate why certain countries continue to grow for very long periods of time.

- DEBASHIS BASU

Can India learn from the framework of economic progress as described by Mr Mokyr? India’s policymakers have no shortage of economic blueprints. Yet, its per capita income remains a fraction of that of East Asian countries. Economic progress can be measured in a variety of ways, but by all measures, India is growing far below its potential. A lot of progress has been the result of two happy accidents — India’s software industry and massive remittances from nonresident Indians. Decades of haphazard actions have resulted in a mixed picture: Pockets of excellence and a prosperous middle class, alongside poor education and joblessness among the masses and 800 million people on government dole.

How can India break from the gentle trot of the last 75 years into a gallop? By focusing on what Mr Mokyr calls “useful knowledge” — the ability of a society to generate, connect, and diffuse new ideas that turn into economic progress. Europe’s transformation in the 18th century, he contends, rested on three interlocking institutions: The generation of propositional knowledge (science and theory), its translation into prescriptive knowledge (techniques and engineering), and a network that allowed ideas to circulate freely between the two.