human angle!

Source: The Hitavada      Date: 11 Oct 2017 14:36:09

THAT rationality is not always at the core of economic decision-making and there is a deeply emotional and human angle, as well, to that process has been the universal experience of human society since time immemorial. But when Mr. Richard Thaler of the United States verbalised the concept in neat framework of economic postulates and constructs, his thesis became good enough to attract the Economic Nobel to the man. This way, Mr. Thaler has highlighted an intangible that often affected the economic process -- of earning and spending and saving.

This fresh light on that universal concept will certainly go a long distance in understanding the current economic theorisation in the face of excessive automation, ideological domination and diplomatic categorisation of global politics. Mr. Thaler, thus, has offered a good clue to prophecising the shape of future economic and political machinations. 

In the era of disgustingly excessive consumerism, it would be worth the trouble to understand the forces that would affect the individual, social and national earning and spending. When populism alone is considered the most critical basis of economic and political decision-making, it would be worth the trouble to realise that it is spending, not earning, that will dominate economic policy. Mr. Thaler has offered a good channel to understand this process more accurately.

The economic thought of ancient India considered all these aspects in great detail. Right from the Vedic period to the period of Arya Chanakya, Indian economic thought always gave precedence to restraint as a credible point of discipline that governed the manner and method of individual or collective spending.

The principle of aparigraha (refusal to collect and store consumables, including money, more than the human need) was considered sacrosanct. In later times, it was Mahatma Gandhi who verbalised the principle of discipline in yet another crisp postulate: ‘Nature provides fully for everybody’s need but not for anybody’s greed’. All he did was to rephrase the fundamental Indian thought on the relation of human economic activity with the universal eco-system. Mr. Thaler’s postulation appears to be in a similar category.

Years ago, when Prof. Amartya Sen won the Economic Nobel, he also had tried to decipher the economic process from the angle of relationship between individual need and social mode. His thrust also was on human dimension that dominates the economic process. In most postulations that attracted global attention in the past fifty or so years, theorists have often tried to highlight the contribution of the intangible component in the economic process.

It is unfortunate, however, that the political masters of the world have tended to ignore the words of sanity and dignity and often given importance to policies that would establish their domination on the world’s resources. This greed, this machination to govern and control the common resource-base of the world, has unfortunately become the global political narrative in the post-World War II period. This possibility was foreseen by many thinkers and wise men and women more than a century ago. They opposed the very idea of colonisation whose main driving force was the control and domination of global resources. In spite of the fact that the world has seen the terrible effects of the ugly process of colonisation, political masters never learned any lesson whatsoever.

As a result, what we see today in global politics is implementation of colonisation in another form -- without political dominion. Globalisation can be a great catalyst, but is being used as a means to impose economic imperialism on weaker segments of the world, though under an innocent-sounding nomenclature of liberalisation.

In spite of the fact that the world has accepted the World Trade Organisation (WTO) as a norm, many countries have realised the oppressive components of the WTO regime that often imposes trade restrictions that compel the national economies to abide by unacceptable barriers. All these have tended to affect the pattern of production and consumption, contrary to the natural flow of human emotion and need.

Let us hope that Mr. Richard Thaler’s thesis would impact the global thinking in this regard. Any theoretical postulation cannot remain confined to books and consigned to academics. It must be brought out for practical use for larger good. In the past few decades, some economic theories have impacted the political decision-making to some extent. Let us look forward to the Thaler thesis creating such an impact.

Like never before, the world has an urgent and dire need to evolve a method that would provide an effective answer to the greed of some nations to control global resources. It is because of this greed that the international realpolitik has tended to get dirtier by every passing year. If this situation has to be altered, then the human community will have to start accepting sane thought more pronouncedly. Mr. Richard Thaler seems to have provided a clue to a saner theorisation and its practical implementation in matters of global economy.

May the world’s superpowers learn the right lessons from this body of good work done by an academic of Mr. Thaler’s repute. That is an urgent need of today’s world that is threatening to get torn asunder due to conflicting interests of various political groupisms.