Question and Answers During Globalization, Development & Inequality

1. Which of India's growth rate is the norm? 6% or the 9% range?
  The panelists answered this indirectly. They said India's growth at 9% can be the norm! But the 9% was not uniform or healthy. We need to find ways and means of ensuring 9% plus growth without impact on climate, ecology and without increasing inequality!

2. Question about Russia.

In Russia there has been an increase in inequality. The average life span has declined. This is more in tune with the fact that Russia has become a rent seeking economy.

3. Is Democracy a prerequisite for reducing inequality?
        The answer if i infer correctly from Joseph Stiglitz is that it is not. The relationship between democracy and inequality is very complex. He mentioned that it was mentioned in textbooks that Russia grew because it was not a democracy and when it started stagnating it was blamed that it was because it is not a democracy!

4. In times of change there is a rise in inequality, example-railways, information technology etc. Is change the driver of inequality?
          The panelists mentioned that this the typical argument of mainstream economists. The question of inequality cannot be left to be answered by market forces. Government has to intervene to reduce inequality by various measures.

5. Taxation
     Discussion about the need to have Cayman Islands! Why should the speculators and other irrational risk takers should be taxed less then the people who are productive like researchers, industry workers etc.

Few other points and my ruminations.

Information asymmetry was mentioned as a reason for inequality. This is always going to be there. Also the fact that 1% of Americans hold 35% of wealth will hold true when we look at wealth of nations. The G7 nations may hold disproportionate amount of wealth and also consume disproportionately. This is due the technology lead which the developed countries have. This cannot be eliminated in near future.  This asymmetry in information is protected by various policies, laws and regulations. When this question was posed to Joseph Stiglitz he replied that China and India will have to work together and bring a change in this. This calls for laws which will be more in favor of developing countries.

Disclaimer: I have missed few question. Also the interpretation of answers might me prejudiced because of my beliefs or disbelief!