behavioural economics

Can I have an opinion on how to annihilate caste?

Social reform is too important an issue to surrender to an ideological monopoly

It’s twitter. So it should not be surprising that it didn’t long for my tweet supporting ACLU against Donald Trump’s executive order on refugees to turn into a debate on caste. I also found out that I am not qualified to have an opinion on the latter because, well, of who I am.

Responses from thoughtful, otherwise sensible and non-partisan people prompted me to write this post. It cannot be that on an issue that is so central to Indian society, we weigh arguments not on their merits, but on the caste identity of the people who make them.

This is not to belittle the sufferings of those who are at the receiving end of discrimination. Rather, it is to reject the dangerous argument that we ought to discount opinions of people based on the community they belong to. It is also to reject the dangerous argument that only members of a community or group have the legitimate right to debate issues concerning their group. I’ve criticised Islamism without being a Muslim, supported women’s rights without being a woman, commented on Pakistani politics without being a Pakistani and recommended military strategy without being a soldier. I could go on, but nowhere have I encountered people telling me I lack the legitimacy to have an opinion on these subjects. On caste, though, terms like “savarna” and “privilege” are flung about as disqualifications by some, and epithets by others.

It may well be that privilege allows some citizens the luxury to be identity-agnostic and caste-blind. Condemning them for this makes no sense: is it wrong to be privileged, to be caste-blind or both? Votaries of an egalitarian society ought to celebrate every additional child that is raised caste-blind. Instead, political correctness requires the caste-agnostic to feel guilty, stay silent and become caste-conscious. This leaves the field only to those who will fight, violently, to protect their social power. Such rancour and strife is counterproductive to the progress towards an egalitarian society.

So here’s my argument. As I wrote, “the annihilation of caste cannot come without the annihilation of caste discourse; you can’t erase it if you keep talking about it.” Now, progressive conventional wisdom is—as one well-meaning person pointed out—“constantly acknowledging and talking about it is actually a very powerful way to erase it.”

Unfortunately, this is not borne out by empirical evidence. Caste consciousness is much stronger today than it ever was. It has become the very currency of political power. I do not see it being erased — on the contrary, it is being reinforced in every generation. The social and political empowerment of historically weaker sections of our society is a wonderful achievement, yet caste-based policies cannot remain the primary mechanism to achieve this. A couple of years ago, for the first time in independent India, the state conducted a caste census. If it were on its way of being erased, this wouldn’t have happened. People even declare their castes on their car bumper stickers now. Given this trend, the best we can hope for is not the annihilation of caste, but merely a caste-conscious society with less social discrimination. It might be a realistic assessment of where we are going, but it’s not the destination I would like for my country.

Indeed, there is evidence that reminding people of their caste adversely affects their performance. One experimental study found that “there were no caste differences in performance when caste was not publicly revealed, but making caste salient created a large and robust caste gap.” A more recent study using NSSO data found that “that caste identity in contemporary India does shape perceptions of self-worth. Among the fully self-employed, we find that controlling for other characteristics, lower-ranked groups earn lower amounts and perceive lower amounts as being remunerative.”

There is enough here to suggest that perhaps not reminding people of their caste will make them perform to their true potential. It is morally repugnant to ignore such evidence merely to conform to conventional wisdom or worse, political correctness. It would be tragedy to dismiss such insights because the researcher is born into the ‘wrong’ community.

Finally, a point about of privilege: what we should care is not whether a person enjoys privilege (or sits in an air-conditioned armchair), but what he or she chooses to do with it. Most members of the Constituent Assembly were men and women of privilege. That didn’t prevent them from producing a Constitution that was far ahead of its times. Should we summarily dismiss their arguments as being the result of privilege?

The poet and social reformer Kabir offers the necessary wisdom:

Don’t ask what his caste is, ask what he knows
Value the sword, not the scabbard it came out of.

Medalless army

The defence ministry must quickly resume issuing official medals.

Last week, a colleague and I were struck by what we saw at a new military supplies store that had opened in our neighbourhood. Among the usual uniforms, shoes, hats, bags and kit, we were surprised to see medals. Not just the ribbons, but the entire suites of medals ready to be stuck on to uniforms. This struck us strange and dubious.

Dinakar Peri’s report in The Hindu tells us why. It turns out that the defence ministry department in charge of issuing medals has not been doing so. Since 2008. So for eight years, the defence ministry has been awarding medals but not issuing them to officers. That’s so long that many younger officers do not even know that they ought to receive the medals from the defence ministry, and not have to buy them from military stores.

It’s not only sad, but undermines the purpose of medals by devaluing them. The economic reasoning behind issuing medals for service and gallantry is to create a “honour incentive” which can both be stronger and more effective than monetary incentives. If you undermine the honour attached to a medal, you weaken the incentive that encourages the behaviour that the medal recognises. If devalued to the point of become a routine, the incentive fails. The fact that the defence ministry hasn’t bothered to issue medals for eight years is therefore disturbing.

It should be the easiest of things for Defence Minister Manohar Parrikar to do to order the Department of Medals in his ministry to resume issuing medals prospectively, and clear the backlog over time. It’s not merely what society owes to its soldiers. It’s an important step in arresting a drift in professional standards.

The paradox of a cashless society

To be successful, the push for cashless society must accommodate the anonymity of cash

There is no doubt that moving towards a cashless society has immense benefits: from making transactions convenient and highly efficient to bringing most of the economy under accountability. From where India stands at 2016, a concerted push towards reducing the use of cash makes a lot of sense.

In an editorial last week, Mint enumerated some important steps to ease the path towards a cashless society: availability of telecom connectivity, investment in technology that improves security and simplicity, and government incentives that favour cashless transactions. In an earlier interview with the same newspaper, Nandan Nilekani argues that since much of the necessary infrastructure — Aadhaar, IndiaStack and Unified Payments Interface — is already in place, the Modi governments currency reform (‘demonetisation’) will act as a shot in the arm for India’s move towards a cashless economy. [Disclosure: Mr Nilekani is a donor to the Takshashila Institution.]

The Mint editorial, however, misses one crucial aspect. Apart from cash being a wireless technology with near-infinite battery life, and one that needs no telecom connectivity, it is its inherent anonymity that makes it a very valuable instrument. Yet, most advocates of a cashless society advocate it precisely because it gets rid of anonymity. Ergo, the extent of cashlessness might well be defined by the extent that people value anonymity and privacy. What this means in practice is that unless the demand for anonymous transactions is satisfied, India might not cross what the editorial correctly describes as “the threshold level after which the network effect will take over.” The question is whether the desire for anonymity prevent a forming a critical mass of Indians that rely on electronic payments. This, more than technical considerations, might dictate the pace at which cash is displaced from its throne.

It is understandable, not least at times of moral panic, that ordinary people will fall in line with the arguments of moral puritans and self-righteous advocates and assert that law-abiding citizens need not fear lack of anonymity. Such views ignore the the reality that families and societies are often held together by harmless lies. For instance, one family member will to put away some money from the rest, without any illegal purpose in mind. Some people like to give anonymously to charity, without any malice or illegality involved. These kinds of innocuous, quotidian acts are a glue that binds society.

Then there are perfectly legal acts that people wish to hide from their families, society or government in order not to attract criticism or punishment. Many people have food habits they’d rather not admit to their family, others might want their alcohol and cigarette purchases to remain hidden. People might give money to NGOs and political parties that are heterodox, dissenting or championing unpopular causes. Such acts characterise and sustain liberal societies. Indeed, even some illegal activities — say prostitution or consumption of certain narcotics — that take place regardless of the letter of the law might have a stabilising influence on our societies. The fact that puritans are disgusted and outraged by this is beside the point. Indeed the story of post-Enlightenment social change around the world is one of legitimising a number of acts previously considered immoral, after weighing them in the court of Reason.

For this reason, some jurisprudence has equated anonymity of cash with free speech. I usually avoid turning policy arguments into a question of rights, as it forestalls further discussion. In this case, though, I think it is justified. It would be hard to sustain free speech if there is an audit trail exposed to the market, society or government. The chilling effect this would have would impinge on the foundations of a liberal society.

Therefore, there are good reasons, both practical and of principle, to retain anonymity in financial transactions. To succeed, initiatives to promote a cashless society must, er, account and accommodate them. Good policy ought to be able to balance many valid considerations and arrive at an optimum approach. Allowing cashless transactions to be anonymous below a certain limit might offer a reasonable compromise. For instance, a stored-value “cash” card, available without requiring proof of identity, limited to payments of Rs 10,000 per month, with an six-month expiry date is one type of solution. This will achieve the transactional benefits of electronic payments, the anonymity of cash and limit the risk of use in large-scale criminality. Of course, even these cards can be abused, but I’d argue that the social benefits outweigh the costs.

If the government takes such a route, it will create enough room for innovation that can, paradoxically hasten the march towards the cashless society. Otherwise, we might take a very long time to cross the threshold that will unleash those network effects.

Tailpiece: It’s not as if a cashless society will lead to greater honesty. Dan Ariely’s experiments suggest otherwise.

“From all the research I have done over the years, the idea that worries me the most is that the more cashless our society becomes, the more our moral compass slips. If being just one step removed from money can increase cheating to such a degree, just imagine what can happen as we become an increasingly cashless society. Could it be that stealing a credit card number is much less difficult from a moral perspective than stealing cash from someone’s wallet? Of course, digital money (such as a debit or credit card) has many advantages, but it might also separate us from the reality of our actions to some degree. If being one step removed from money liberates people from their moral shackles, what will happen as more and more banking is done online? What will happen to our personal and social morality as financial products become more obscure and less recognizably related to money (think, for example, about stock options, derivatives, and credit default swaps)?” [Dan Ariely, The (Honest) Truth About Dishonesty: How We Lie to Everyone – Especially Ourselves.]

An eightfold path to improving urban traffic

There are quick an inexpensive ways to improve traffic flows in our cities

This is a version of an op-ed that appeared in the Bangalore edition of today’s Times of India:
We can approach a solution to the vexed problem of road traffic if we pay attention to one simple concept: flow. It is distressing to see so much of the public debate, civil society angst and government policy follow various red herrings. One the one hand policymakers blame lack of funds, and it is true that the municipal corporation’s entire annual budget is smaller than what is required to upgrade the road network to modern standards. On the other, citizens blame the pyramid of corruption that brazenly siphons off even what little funds are allocated for the purpose. There are also issues of masterplanning, infrastructure design and maintenance.

While there are degrees of truth in all these arguments, what seems to be lost is that conceptually, the problem of traffic is a problem of flow. While more money, less corruption, more infrastructure and better design are indeed medium-term and long-term solutions, they are complex and unlikely to be easily addressed in the churn of India’s democratic politics. Even so, we must push forward on them. However, in the meantime, if we focus on improving flows we can enjoy some respite from the tyranny of traffic almost immediately.

Here is an Eight Fold Path to improving traffic in the short term, without requiring to spends massive amounts of money.

First, and most important, focus on the flow. Do not get mesmerised by road-widening projects that are not only messy but might not improve the situation. Unless a road is of uniform width throughout its length, flow is unlikely to improve much by widening. In fact, uneven road width causes congestion and can actually worsen the situation. Do not widen a road unless you can widen it along its entire length.

Second, remove road cholesterol. In many places almost 40% of the road is unusable because, like clogged arteries, circulation of traffic is choked by various blockages. Potholes, construction materials, parked cars, auto rickshaw stands and street vendors interrupt traffic flow and not only cause congestion points but also endanger safety of motorists and pedestrians. No, this does not mean banning these legitimate activities. Rather, it means regulating them to minimise the impact on traffic flow. Make it compulsory for construction material and debris to be placed in bins, with a fee charged for occupying road space. Make parallel parking compulsory, draw parking lots and assign a serial number to each of them. Move auto-rickshaw stands away from street intersections. Similarly, ensure street vendors occupy designated lots.

Third, get cows and other animals off the road. It should be astounding that a city that connects India to the global economy, and one that suffers so much traffic congestion, tolerates herds of cows on its major roads. Cows might be holy but that does not prevent them from causing congestion and endangering their own lives and the lives of motorists.

Fourth, make all lanes of uniform width. Today, lanes are mostly not marked, and where they are marked, they bisect the available road width. The lack of lane markings and lanes of varying widths create no behavioural triggers for people to drive in a disciplined manner. Lane markings should always be clearly visible and not left to drivers’ imaginations.

Fifth, enforce queuing for right turns. One of the biggest reasons for congestions on major roads is that when vehicles wait to turn right, they do not queue up one behind the other. Instead, they line up side-by-side in an right-turning arc. What this means is that all the vehicles that intend to go straight ahead or turn left are blocked. It doesn’t matter how wide the road is, if right-turning vehicles do not queue up. Barricades can be placed to create a right-turn queue to create this driving behaviour norm.

Sixth, there have to be a lot more directional signs on our roads. Overhead gantries identifying lanes for left, right and straight ahead are necessary. These must be placed well-ahead of the intersection so that vehicles can change lanes much before the intersection.

Seventh, the stop line at intersections must be prominent. Right now its exact position is left to the imagination and discretion of drivers. This makes it impossible for pedestrians to cross safely or other traffic to pass across the junction. The stop line must be a lakshman rekha crossing which should attract severe penalties. Cameras already exist that can enforce this easily.

Eighth, movement of heavy vehicles and tractor-trailors cannot be unrestricted as it is now. Slow moving vehicles such as these not only slow down traffic but also create incentives for illegal and dangerous overtaking by other motorists. If they cannot be limited to certain corridors and certain times, then they must be compelled to move only in the left-most lane. Again, camera footage can be used for penalising offenders without burdening on-ground police personnel.

Finally, although pedestrians ought to have the first right on the road, they are constantly robbed of their safety and dignity. Traffic lights for pedestrian crossings seem to have been designed for Olympic sprinters, as it is almost impossible to cross even a mid-sized road in the ten seconds that are allocated for the purpose. Skybridges and underpasses are impractical if they have steep staircases or are located at unnatural crossing points. At times where traffic lights are sought to be synchronised to create “green channels” and smooth traffic flows, the pedestrian’s rights must not be sacrificed. Give them more time to cross the road; and dissuade them from crossing where they shouldn’t.