CHAT Shankar Jaganathan, in trying to trace the history of economics in his latest book, dissects how social changes affect it
Shankar Jaganathan started his career in chartered accountancy and gave up his job when he was 43, to pursue his passions. “I saw that while my friends were running around with their corporate jobs and very busy, I had enough time to do everything I wanted to do. This made me think about the many economic processes that govern our lives and the book The Wisdom of Ants: A Short History of Economics was born. I have made an attempt to unravel the mysteries behind the economic evolution and change misconceptions about economics in this book.”
He adds, “In this book, I draw the history of economics from Chanakya’s period to the recent Occupy Wall Street Movement. Economics began with the individual right to own property and the notion of being self-centred. I used the historical investigative approach and realised that social issues have a great bearing on economics. Changes in the social setup also bought about changes in economic exchanges.”
Moving on to contemporary issues, Shankar also mentions the recent economic crash and the reasons that brought it about. He contends, “There have been 69 Nobel prizes for economics. I feel that if they had not started awarding Nobel prizes in this category, the great crash of 2008 would have never happened.” He adds, “The 2008 crash was primarily created by lack of proper regulations and the quantification of ‘risk’ as a commodity. This resulted in speculation and played a vital part in the crash.” How does the layman understand economics without being overawed by jargon? “Economics can be made understandable to the layman by talking about instances from daily life. I have made an attempt to do that in this book.”
Shankar holds the low tax burdens in India responsible for the lack of an actual social security net. “Unlike the Nordic states, which tops the HDI indices in almost all categories, India lags at the bottom, because of a narrow tax base. We are probably the only democracy on the planet that does not levy an inheritance tax on family businesses. Our tax collections are abysmal. This is the reason that despite having many dollar billionaires, we have one of the largest populations in the world living in sub-human conditions. A good social security net is vital for the development of any country.”
The Wisdom of Ants: A Short History of Economics is published by Westland (Rs. 295).