ECONOMIC NOTES

Once More on Minerals and Imperialism

THE Industrial Revolution which inaugurated industrial capitalism in the world had occurred in Britain in cotton textiles; but neither Britain nor other North European countries could grow any raw cotton at all. The very coming into being of industrial capitalism in short was dependent upon the metropolis obtaining a steady supply of raw materials from wherever they happened to be produced. This situation has not changed one iota in all these years.

India’s Growing Income Inequality

THE World Bank has recently published a list of Gini coefficients for 61 countries relating in some cases to income distribution and in others to consumption expenditure distribution. In that list India had the fourth lowest Gini coefficient in 2022, on the basis of which the Modi government has gone to town declaring India to be the fourth most egalitarian economy in the world. The ludicrousness of this claim has already been exposed by several researchers; and spending more time over it would appear like flogging a dead horse.

An Enduring Myth About Capitalism

THERE are of course many myths about capitalism spun by economists. One of these myths spun by David Ricardo has endured for over two centuries. Ricardo had originally been an enthusiastic supporter of the introduction of machinery, dismissive of the argument by workers’ organisations of his time that it gave rise to unemployment.

The Havoc Caused by Say’s Law

JEAN-BAPTISTE Say, a French economist who wrote in the late eighteenth century, had formulated a law to the effect that ‘supply creates its own demand’, which meant that there could never be an inadequate demand for the aggregate of goods produced in any economy. His argument was as follows. Whatever is produced generates an equal amount of income among those associated with its production. This income is either consumed or ‘saved’ (i.e., not consumed).

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