Economics is not mathematics

economic_divideThere is a delusion policy makers and people are currently living in, and needs serious examination – that the economists have scientific answers, and know what is best for a country. It must be understood that economics is different from mathematics. It is more interpretative than absolute. Every economic argument has a counter argument. Every model of economic theory has its success stories to share, and failures to be ashamed of.

The power behind economic positions is determined by political ideology, the backing of power, and money – sometimes ill-begotten. It is also determined by a variety of motivations. It is tragic that the community of economists, which prides itself on its objectivity, has become the new God. Opinions are created by selective perception. The media helps reinforces the view that this is the whole truth. Only a few decades ago, it was internationally accepted that economic designs emanated from political priorities. But today we have conveniently elevated economics to a science, and we abide by it.

Our policy makers have consistently distanced themselves from poverty and its causes. In their euphoria about the GDP, growth rates and sensex figures, they have deliberately ignored the consequences of endemic hunger and deprivation on the people. They consciously ignore the alarming figures of infant mortality, literacy, unemployment, and the per capita income of the poorest 30%. In the words of P Sainath, Inequality, and not IT is the fastest growing sector of India. India is a complex web, inexplicable by mere figures and numbers. We need to look back as much as we need to look forward.


One response to “Economics is not mathematics

  1. I am inclined to accept your postulates, but is there a way to change a behemoth’s way of functioning when the power to change it rests with the very people who resist change? Read the India Today Budget view of this month, they directly discuss what I know to be true- remove the entire unnecessary and complex ministries. Make it simple and more efficient. The “economic” and monetary world intends to spin on as it has been for the past few 100 years. For it to even consider a different scenario, we need like minded fellows effecting positive change, not just affecting change.

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