People And The Economy: Business World : Book Review: 2nd January 2012

Public Economics:Theory and Policy, Essays in Honor of Amaresh Bagchi
Edited by M. Govinda Rao and Mihir Rakshit



This one-stop book on public economics is a tribute to economist Amaresh Bagchi. Edited by M. Govinda Rao and Mihir Rakshit, Public Economics is a compilation of 10 eclectic articles covering the entire gamut of relevant and important issues. Expectedly, there is a chapter on Bagchi and his contribution to India’s fiscal policy. The article evaluates the extent to which fiscal deficit targets make sense in our economy, considering our socio-economic goals, which make static targets quite irrelevant. Complimenting this view is an article on how we should be broad basing our tax system and lowering rates.

The book presents Bagchi’s pioneering work on consumption tax and highlights issues in bringing about harmonisation in our federal set-up. This is followed by Rao’s own take on federalism. An interesting survey that says gains of peace, trade and environment have led to interest in these global public goods. Curiously, it says that the WTO and the UN Framework Convention on Climate Change do not quite focus on developmental concerns. An article on environment taxes highlights how industries can cope with this through a ‘cap and trade’ scheme.

The last few articles are more conceptual. The final piece comprising budgetary principles, non-tax revenues and global fiscal concerns, belongs more in a class room and can put off the reader. On the whole, the book is a commendable compilation that will appeal to students and probably, bureaucrats and is worth reading.

(This story was published in Businessworld Issue Dated 02-01-2012)