January 6, 2017 2:43:32 am
French economist and Nobel laureate Jean Tirole on Thursday, while backing a cashless economy to make corruption “more difficult”, said much of the corrupt money was already stored in different forms. The Scandanavian countries’ experience with moving to a cashless economy, often cited as an example for India to follow, has to be seen in context of these nations’ objectives, he said.
“People want to get rid of cash for several reasons and you see that in Scandinavia. For example, Denmark and Sweden are trying to get rid of cash because it is more convenient. In India, the reason is to get rid of corruption,” he said. “By the way, Denmark is a different case because they are trying to give prepaid debit cards to the poor. That’s what you have to do for a cashless economy because the poor rely heavily on cash.”
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Tirole was in the city to deliver the Dipak Banerjee Lecture at Presidency University, which is organising a number of events as part of its bicentenary celebrations. Tirole had won the Nobel Prize in 2014 for his analysis of market power and regulation. “You cannot get the corrupt money right away because the money has already been invested in real estate, gold and other things,” he said, adding that the move would “make future corruption more difficult”.
Before being asked about demonetisation, Tirole spoke about the morality of markets. He added that “lack of justice” in society itself was a marker of market failure. He said, “Think of right to education. It is basically an insurance for not being born in the right place. Thinking in those terms, you have the question of what kind of society we are in.” Chairing the discussion was another Nobel laureate and Presidency alumnus Amartya Sen.
Sen said it was a “great moment” to celebrate the “past, present and future”. He said when Presidency was founded, it was a “civil society initiative” and that it was “probably the oldest institution in the world founded without any religious affiliation”.
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