Political Freedom and Nudging


Richard Thaler and Cass Sunstien wrote a book in 2008 titled ‘Nudge’ which claimed that governments may be better able to achieve using less intrusive techniques borrowed from the world of psychology. The question now is whether the government has the right to meddle with individual’s choices, if doing so increases our well-being. One argument presented in favor of nudging is, I quote Sunstien “ultimately what matters are the cost and benefit of individual nudges”. But the other argument to consider is whether a loss of liberty is worth the price. The bottom line is whether we believe in the government that they will look after our best interest.

Applying this theory to the current Indian political and economic environment, the question we should ask is should the Indian government nudge in a decisive way and act with courage and conviction. Prime Minister Singh’s administration clearly took the view ‘let the sleeping dog lie’ and went into a long slumber. Economists called it as policy paralysis. Their only objective was how to ensure continuity in power. Look what happened.

Millions of young people have joined the job market looking for a meaningful work in vain. Industrial and manufacturing growth has basically come to a standstill. The value of currency went for a toss fluctuating between 45 and 68 rupees to a dollar before it settled at 60. Subsidies and interest payment of the annual budgeted amount eats away nearly 30 percent of all the monies available. Also

  • Corruption running into trillions of rupees either as NPA in banks or project scams. The possibility of recovering the funds lost is remote
  • Uncontrolled inflation eating away both the earnings and savings
  • Lowe inflow of FDI and poor infrastructure commitment

Isn’t it time the new government recognize many of these issues and address them with 100 percent commitment? It will be a sad day if the new government is a minority one with its members not having common platform. India which should have been a leader in economic growth are now struggling hard to maintain bond rating at BBB

Mr. Prime Minister, this is an appeal to you. Please get real. We do not want to slowly disintegrate and continue to have anemic growth. Young people of this country should stand tall and be proud of his citizenship. With honesty, hard work and commitment all economic problems can be handled bringing hope and confidence. This is the time that citizens are made to feel like a stakeholder. Together we assure you, we can take our country to new heights. Nothing works better than strong belief and optimism. Please be with us and help us to take the country to new heights.

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