<
p>I’m a big fan of Bryan Caplan & Arnold Kling over at EconLog and in particular thought mutineers would be interested in this blogpost. Caplan analyzes a paper 
from Rafael Di Tella (HBS) and Robert MacCulloch (Princeton) which models the relationship between a country’s perceived level of corruption and its political orientation –
We find evidence consistent with the hypothesis that governments in poor countries have a more left wing rhetoric than those in OECD countries…The empirical pattern of beliefs within countries is consistent with this explanation: people who perceive corruption to be high in the country are also more likely to lean left ideologically and to declare to support a more intrusive government in economic matters.
Put simply, more perception of corruption = more likely to be an economic lefty. Bryan brings up the all-too-obvious consequential impact — increasing the role of govt in the economy, particulary in the midst of corruption, should increase the level of corruption overall. Caplan quotes Anne Kreuger who coined the term Rent Seeking back in 1973 –
If the market mechanism is suspect, the inevitable temptation is to resort to greater and greater intervention, thereby increasing the amount of economic activity devoted to rent seeking. As such, a political “vicious circle” may develop. People perceive that the market mechanism does not function in a way compatible with socially approved goals because of competitive rent seeking. A political consensus therefore emerges to intervene further in the market, rent seeking increases, and further intervention results.
Di Tella and MacCulloch duly note, however, that the Indian electorate seems far more intelligent about this issue and presents a very interesting exception to their general observation –
When the analysis is carried out at the individual country level an interesting exception occurs: India. In this country there is a positive and significant correlation between the perception of corruption and placing one’s views on the right end of the political spectrum, not the left.
Perhaps it’s because Desi’s have been uniquely well acquainted with the combination of
-
40 years of empty, albeit well intentioned rhetoric
-
widely lauded business acumen
The Founding Fathers were quite prescient that the lack of angels amongst men both created and limited the scope of government; unfortunately, for the rest of the 3rd world, it seems, the population is rather swayed by appeals to use government power to bring about Cosmic Justice…
I would say that those middle class Indians who can’t “work the system” and don’t have a relative in the IAS or IPS turn right. There are some enthusiastic Indian communist profs who work for small liberal arts colleges in New England who grew up in nice estates for state run industry employees who luv Marx chacha so much
One of the mantras of people living India in the 60-70’s was that corruption was wreaking havoc on india. I’d trust those people to know, they are the ones who made the difficult journey at a time when leaving meant wondering how many years, if ever, you’d be able to visit India again
I’m still reading through the paper, so apologies if comments are not complete. From the excerpt you’ve included it looks like a higher perception of corruption makes the voter lean “left” politically. Is it that perception –> political leanings, or that political leaning –> perception? How do the folks define “lefty”? A more state-controlled state? If you take the case of Indonesia, the state is absolutely involved in economic decisions, but not really huge on public spending. How do you delineate between, oh, totalitarian Russia and a Chilean dictatorship? (see: Ben Olken, 2005) Not sure if it can be attributed to “cosmic justice,” but maybe, in light of international dialogue on corruption and the aggressive rhetoric of World Bank/IMF/UN-types, local citizens expect a comparable entity (national government) to respond and be accountable. So perhaps it is not that they expect the state to fix it, but that they expect the state to build in measures of accountability.
I suppose I should read the article before commenting more. 🙂
One thing the article would have to clear up is whether the perception of corruption is accurate. If people perceive their country is corrupt, and then also advocate positions that are in some way “Left”, then it does not make them wrong or right. If anything, they are right about their judgment. They then advocate solutions, which may be considered Left or Right (it seems like a lot for one given article to prove that the Left or Right solutions are correct).
Vinod – I took a look at the paper only to realize that it’s 42 pages of hardcore economic modeling and so will resist doing that from work. However, maybe you could throw some quick light on some of these things since you may have read the paper
The authors do say that the common perception in India is to lean fiscally right. I wonder what the sample space was for this observation. If they look at urban middle class as the representative, then I agree that the view is more fiscal right wing – what has been oft called the Indian neo-liberal. However, if we start asking people in the hinterlands where the benefits of free markets are yet to reach substantially, then we may not be so sure. Case in point – suiciding farmers, maoists and Naxals, a lot of poor villages where roti, kapda and makaan slogans still work. If not, we would not have seen the more right wing BJP lose power and Congress come back based on roti kapda slogans.
If we discount my point #1, the authors do make a interesting observation about starting ideologies. India did go through 50 years of leftist intervention and thus once the people started seeing the benefits of free markets, we have seen a lot of enthusiasm for open door policies. So much so, that sometimes finding the balance for the rate of liberalization becomes a challenge.
Sahesj – corruption is highly rampant and wreaking havoc even today. It’s probably the biggest thing holding India back today.
Vinod, I haven’t read the paper but from your excerpts it seems the corruption being alluded to is that in the private sector. In India, most of the “corruption”, particularly that in public consciousness, is in the public sector, and public sector enterprises; so much so that in comparison the private sector has a glow similar to that of the US 1920s. That seems like a better explanation for the “anomaly”.
Regarding political inclinations, most in India are disturbingly left-leaning still; most want to stem corruption in govt by hoping for “better” people in govt and PSUs, and by creating more governmental layers to keep a check on the existing govt bodies. Add to that the correlation between leftist populism and poverty; India is still sadly very much caught in this vicious cycle.
Man, did you really just toss out the term “third world?”
The term third world isn’t neccesarily pejorative, I actually think it was meant to indicate the Non-Aligned movement that India was a leader of. It was supposed to the the “third way”
Other terms that get used include “majority world” in that the majority of the world was also “third world”
The blogpost Vinod refers to is titled: How the Rational Voter Assumption Derails Promising Research. WTF does this mean? The paper referred to is similarly obtuse.
If I understand correctly, the paper suggests crony capitalism — politicians meddling actively in favor of existing and connected players — pushes people against capitalism and into the arms of the inviting socialists. But these hold true in India as well; much more so before liberalization; there were other entry barriers as well — a lack of capital, high interest rates; hobbling participation of even upper class Indians in the organized marketplace.
Why are we performing marginally better than the Latin American and African countries in holding back the tide of socialism? (Look at other subcontinent nations as well — most are socialist whirlpools/dicatorships)
I believe one reason was the Hindutva brigade which conflates their religious rhetoric with (marginally) economic rightist rhetoric; plus more importantly the service sector. The service sector; plus the IT, BPO windfall; allowed many Indians to circumvent the barriers thrown in by leftist governments and still participate in a thriving marketplace.
Economics literature is hard. Since when is something hard to understand necessarily not valid?
Wha??? All desis are well acquainted with “widely laded business acumen” . News to me!!
Also, the article ignores that until recently, most politicians in India were fiscally left-leaning. The Indian right is way left that most of the world. Most politicians got votes by promoting food/water, etc etc to their constituents.
I think the shift to the right can be attributed to the rapidly growing middle class population. The middle class sees a lot of opportunities in the private sector and hence, supports policies that loosens restrictions of the growth of the private sector.
We have a communist government that unrolls red carpet for foreign investors over dead bodies of its citizens. Then we have cultural supremacists chilling w/ Michael Jackson. It’s a complex landscape. Most politicians are considered equally corrupt. People don’t so much veer left or right but try to chose the lesser evil. In some cases they eve have different preferences for state and national representatives.
Pagla is right on the money. Indians have a deep anti-market bias, even those in the middle-class, though that is slowly changing. As I mentioned above, the service sector which could thrive inspite of credit and business controls, par for the course in any self-respecting socialist country, allowed the burgeoning of the middle class and upper middle class, who now have a stake in the market.
Academicans left and right commonly hide behind a fog of poor writing.
‘Hard to understand’ does not imply ‘well-written’ or ‘makes sense.’ Which part of “How the Rational Voter Assumption Derails Promising Research” makes sense to you?
Since when is something hard to understand valid? 🙂
I read the blogpost — not impressed. I think the authors are making a few statements that go beyond what their data can provide.
Pagla:
good points. Part of the problem with the terms “right” and “left” is that they do not have much in terms of shared contextual meaning; the terms are largely only relevant within a country, not between them. One country’s left may be another country’s right, etc.
Even the use of “conservative” and “liberal” as some sort of dimension gets on my nerves from time to time. The terms are not opposed in the English language: you can be liberal, and also conservative at the same time. What are we conserving? What is it about us that is free? Who’s measuring us?
Irrelevant, I know. I suppose I’m dithering because I don’t want to open that PDF just yet. My brain is still tired from the weekend.
Camille,
The statistics were hard to understand, but to me the key point is whether people are correct to try “Left” solutions, and that was left unproven in my opinion as well.
Bryan Caplan recently came out with a book called “The Myth of the Rational Voter”. I read about it on Marginal Revolution, and I think Alex (or was it Tyler?) reviewed it positively. I am guessing this post is probably pulled from that book. (Haven’t read either the book or this paper, maybe later tonight).
There are the centrists and then there are those who are fiscally right and socially left, a lot of libertarians claim to be that. Though I have never met a person who is socially right and fiscally left.
See P.J. O’Rourke’s Eat the Rich. Especially first chapter where he skewers econ-talk.
Classic: No idea, however simple–“When there’s more of something, it costs less” –can be expressed without rendering it onto a madras sport coat of a graph and translating it into a rebus puzzle full of peculiar signs and notations.
His (low) opinion of Economics by Paul A. Samuelson: “Marx was the most influential and perceptive critic of the market economy ever,†he says on page seven. Influential, yes. Marx nearly caused World War III. But perceptive? Samuelson continues: “Marx was wrong about many things … but that does not diminish his stature as an important economist.†Well, what would? If Marx was wrong about many things and screwed the baby-sitter?
Most Indians no? It is a typical feudal characteristic really. You want to be your social life to be controlled by traditions and your economic (etc) life to be controlled by govt.
This article was written in what seemed to be pretty plain-spoken language
I stand corrected, you’re right. I guess I got caught up in an elitist microcosm.
That’s why your political leanings can be more accurately described using the 2 dimensional Political compass http://www.politicalcompass.org/uselection . You are either Authoritarian or Libertarian; and you can either be Conservative or Liberal. An Authoritarian is someone who supports more government involvement; a Libertarian is someone who supports less government involvement. A conservative is someone who believes in keeping the things the way they are, and a liberal is someone who believes in changing things for the better. So, you can be either a Conservative Authoritarian, a Conservative Libertarian, a Liberal Authoritarian or a Liberal Libertarian. Additionally, there is another dimension: you can feel about the social policies one way, and fiscal policies the other way. So, as an example, I am an Social Liberal Authoritarian and a Fiscal Conservative Libertarian; meaning that on I would prefer the government to spend more effort bringing about social change, and less effort meddling in business
Indian government, for the most part, has been (fiscally and socially) Conservative Authoritarian, and is perhaps a testament to the idea that Fiscal Conservative Authoritarianism doesn’t work. Singapore, for example, gained independence after us, and is mostly Liberal Authoritarian is far far ahead of us. The middle class is moving towards the Libertarian side, and it remains to be seen whether the rest of the country moves with us.
I just saw Sicko, which carries a reductive but strong message advocating socialized medicine as an antidote to corruption in the private sector, but this isn’t a model to explain everything everywhere. That leftward drift is certainly taking place in this country, and corruption is certainly the focus for the longest election “year” ever, right here, but “perceived corruption” –here or elsewhere — is a problematic construct. For one thing, it suggests that the popularity of left wing politics anywhere is a viable indicator of the presence and level of corruption. Without reading the giganto paper Vinod linked to and which I just downloaded, I’m thinking that the 100,000 and more suicides and survivors too, among farmers caught in the maws of the still mounting debt crisis in Desh, probably didn’t perceive corruption so much as willful neglect.
Any orientation on the spectrum comes laden with meaningful, defining, cultural and historical considerations that can only be easily discarded by people who know and care to know little about other cultures. louiecypher, I can think of at least one Marxist prof often quoted on SM whose personal background was the antithesis of all that he now stands for…Salil and Sahej, IIRC, the term Third World was coined at the Brookings Institution, effectively to redefine countries of the Non-Aligned Movement as the battleground for the First and Second Worlds, but it became colloquial for poor and dirty pretty quickly.
Sorry, Brookings Institute. Marriage and the Smithsonian are institutions.
. MY extended family is bigger than Singapore. Pleeeeeez.
Amrita, not for long, if teh gheys are allowed their way. As we speak there are entire neighborhoods being taken over by teh gays.
No to fear my friend, population will be kept vigorous despite nonparticipation in procreation. Cloning, test tube babies were invented in the desh only
louiecypher, I cannot help but marvel at your plan! First you’d let teh gays catch hold of the Ayurvedic cloning technology. They’d then multiply; take over our corrupt bureaucracy; and proceed make it fabulous! The Indian public would look at the lower corruption, read the above paper, and become inclined to the right. And since they’d incline to the right, they’d then ban the gays! Problem solved. Splendid my man splendid.
HyperTree, there are many colors in the gay rainbow. Have you not heard of Andrew Sullivan ? Sure some might give Abdul Kalam a much needed makeover. But maybe one of the cloned gay babies would be a brown Roy Cohn and would oppress himself and his brethern without the need for a straight right wing interregnum
In the 90’s I worked for two years in an anti-corruption unit in a major Public Sector Undertaking in India. The official term for anti corruption units in the government sector is “Vigilance”. The stint totally put me off India and I could not wait to get out (took me a few years though). Most people dont connect the current economic benefits with the free market. Most Indians agree that more government is better. I suspect that many Indians see the government in paternalistic terms and expect the State to protect them from the rapacious business owners. Businessmen (they are mostly men) dont exactly endear themselves with their behaviour. They are often more corrupt and venal than the public servants. One of the reasons that Infosys became a media darling was because the owners were the antithesis of the average Indian businessman. They were a major story even when they were a $100 million company. It is well nigh impossible to convince a family mired in poverty that the market can resolve their problems. All that they can see is the rich landlord and the poor serfs. The solution for corruption is not more regulation but less. But, not a position that will be accepted in India.
melbournedesi, I really liked this point. I have nothing original to contribute, just wanted to let you know 🙂 Although sometimes I wonder if also parts of life have become so common place that differing reactions are based on what people consider “acceptable” or “unacceptable.” That is, is it ok to have to bribe mamaji everytime you drive down GT Road, but less ok to pay off some business-wala? What’s the difference between mamaji and a gunda, anyway?
One thing that might skew corruption stats… many states at the right end of the spectrum are oligarchies with very weak central governments. In such cases favors and graft would pass directly to/from influential families and corporations…
Camille : Not sure if I understand correctly but how does one bribe a businessman. The businessman bribes the State to protect his interests. Many a poor person has wished that they could be a cop who can collect “rent” from various businesses. As someone who has lived more than half his life in poverty (poor by Indian standards not Western), I know that the single biggest threat to the existence of the poor are the various arms of the State. Talking about property rights to the poor is useless because the enforcement of property rights is lopsided. Eg. Police protect property of the rich – never the property of the poor. I say this from personal experience. Is it any wonder that the poor are easily swayed by communists. Property rights is the foundation of a free market.
I dont believe that the rich and powerful in India want a free market economy. I think it is because that would result in the number of rich increasing exponentially. Listen to the snide remarks that the old rich make against the new rich in India and you would understand what I mean. Businessmen in India are not paragons of virtue. They have gotten rich by virtue of the Licence Raj. Reliance is a classic example of an entity that has built and maintained its wealth using the State. In the 90’s there was a “Bombay Club” comprising of rich industrialists from Western India headed by Rahul Bajaj. This club wanted “protectionism” to continue. Now this is no different in the Western World but in a country where the captains of industry lead luxurious lives while the masses toil to eke out a bare existence, such behaviour is bound to create communists.
My understanding is that mamajis have John Waters type pencil moustaches and generally outsource “enforcement”. A gundu is fat Tamilian. A goonda, which is what I think you meant, typically sports muttonchop sideburns and handlebar moustache. Their philosophy vis a vis violence is D.I.Y.
Gundu also means bomb. There’s a funny story here. The ex Tamilnadu chief minister, Jayalalitha, is quite corpulent. To the extent that the Indian Parliament had to be evacuated when she visited, because of a message somebody sent about her.
I think of mamajis as cops. I’d say their moustaches are more of a droopy toothbrush yearning to be a handlebar ilk. They can often be quite acrobatic despite their girth.
Yeah louiecypher, I was referring to those. The views you’re talking about are pretty astonishing. Its pretty cool that the South is doing well. I just hope you all don’t start riding Northie’s for being uncouth/whatever else.
Its really funny what myths people build around themselves. In South Asia persians are considered uber cool, but I just watched 300 and they made the persians look like total dorks. To be honest with you, I used to see punjabi guys who would think they would win South Asian basketball tournements just by showing up and saying chuk dey phateh. Yeah, right.
Sahej, I think you meant for the comment above to be in the Kerala thread. I think these feelings are rapidly disappearing among the educated..so many of the young Indian immigrants I meet are in linguistically mixed, North/South relationships. Far more serious is the animus between S. Indian states over water rights etc.
I think desis are situationally “right”. I am not sure how many Indians in India would find Ron Paul’s libertarian worldview attractive for example. My parents who have been Dems for the past 30 years definitely believe that government can be a force for good here. But in India, at least for those who are not connected, government has been a parasitic institution for so long that the middle class cannot conceive of it as being anything other than malignant. So when the Indian middle class is arguing for less controls it is not that they do so out of some solidarity with Western libertarian theorists who believe in the good sense of the individual, but rather the knowledge that the Indian government can do no good
My question was rhetorical 🙂 We use “mamaji” to mean the cops, also. loucie, you say “goonda” and I say “gunda” — one and the same 🙂
melbournedesi, while I’ve known folks who have to pay off the cops (business-wise), I’ve also met a lot of people who had to bribe bigger business folks for protection, or who had to pay “a little extra” off the top for the same services they would get elsewhere. Not sure if one would call that bribery, or the impact of a highly elastic unregulated economy.
I bet the B-grade movies don’t help. I can’t count the number of times Amitabh and Mithun have vanquished pot-bellied businessmen.
Ok, that’s a poor theory. Minister Satyendranath has been the villain as often as Mogambo and Mr. X smuggling cocaine.
There should be some advanced training in graft for babus so they don’t dishonor the nation with their stupidity. Did anyone see the Tehekha tapes ? The undercover jounrnalist was a young guy who had never traveled outside of India but was supposed to play the local rep of some UK based arms dealer. At one point he is talking to Fernandes or someone high up in his org who asks “Where in London do you live”. The poor journalist fumbles and says something like “Liverpool in London”. The babus are momentarily confused and pause a bit but then rush to take the bait like little piggies. A properly trained babu would have smelt danger and had the journalist stripped down to his komanam and searched for a wire in less than 5 seconds.
Louiecypher,
Yeah I think you’re right meant for the other thread. Have also noted ancedotally the generation growing up now isn’t usually so concerned. As always, the diaspora seems to lag a little behind, although not really there either.