Notes on the Political Economy of India's Tortuous Transition

Abstract

Pranab Bardhan (bardhan@econ.berkeley.edu) is at the University of California, Berkeley, United States. In 1983,1 tried to explain the sluggish investment and growth in India up to that time in terms of the difficulty of collective action on long-term public investment among India's divided elite groups (published as Bardhan 1984). In the last quarter century a great deal of sub stantial socio-economic changes have taken place, and investment and growth rates have improved considerably. In this short essay I will reflect on the systemic implications of these changes in a schematic and shorthand way, particularly from the point of view of the transition (much ma ligned in some quarters, much awaited in others) to an enlarged and dominating sphere of capital in the economy.