The Sveriges Riksbank Prize in Economic Sciences
The prize was awarded to Joel Mokyr, Philippe Aghion, and Peter Howitt for their contributions to understanding economic growth.
Key Theories
- Joel Mokyr: Societies thrive when they cultivate and disseminate "useful knowledge."
- Philippe Aghion and Peter Howitt: Highlighted the productivity of knowledge through competition, destruction, and regeneration.
India's Economic Framework
India, while having many economic blueprints, lags behind East Asian countries in per capita income. Its economic progress is uneven, characterized by both high-performing sectors and widespread poverty.
Challenges and Opportunities
- Current growth is fueled by the software industry and remittances.
- Despite a world-class scientific community, India spends just 0.7% of GDP on R&D, mostly from the public sector.
- Indian universities excel in teaching but lack in research, with industries favoring imported technology.
Learning from Mokyr's Framework
India can accelerate its growth by focusing on generating and circulating "useful knowledge."
Historical Examples
- 18th Century Europe: Transformation through three institutions generating and circulating knowledge.
- Modern China: Invests over 2.5% of GDP in R&D with a thriving network connecting research and industrial clusters.
Actionable Steps for India
- Enhance technical education and expand the network of universities and polytechnics.
- Encourage private R&D through tax incentives and PPPs.
- Integrate academic research with industrial practices.
Conclusion
To realize its potential, India must prioritize the creation of a robust system that fosters the accumulation and application of knowledge. This requires building institutions, providing incentives, and fostering a culture that values knowledge.
