Editorial
Hindustan Times
October 15,1998
New Delhi

Pride of India

The award of this year's Nobel Prize in Economics to Prof Amartya Sen is an indirect admission by the western world of the failure of reckless marketisation of the world.

When the entire world was gloating over what a Japanese thinker called "the end of history" after the collapse of Communism and was recklessly preaching the gospel of the market, Prof Amartya Sen was striking notes of caution. Instead of the growth oriented economic path to prosperity, he emphasised the need for giving a human face to development. In this sense, the Prize comes a bit too late for the man. All these years, economic theories of a particular line of thought were rewarded with the world's most prestigious Prize. After a really long time, an economic philosopher who could talk and write about the political economy of hunger at a time when the World Bank and the IMF were extolling the examples of the East Asian Tigers and prescribing the unrestrained flow of global capital into national markets in all countries regardless of the state of the individual economies, the level of living of the majority of the people, especially women, has been chosen for the highest honour. If any one nation or individual were to suggest a course correction in the economic thinking of the world, it has to be India and an Indian. Prof Amartya Sen, with his emphasis on welfare economics and definition of poverty in relation to development has at once offered a new philosophy and an alternative way to socio-economic development. In this respect Prof Sen's contribution to applied economics is as momentous and relevant to the contemporary world as John Maynard Keynes' theory of employment during the years of the Great Depression almost seven decades ago.

To an extent the Royal Swedish Academy has restored the credibility of the Nobel Prize from the damage it suffered by the award of the same Prize to a pair of market economists who wrote on evolving the so called "derivatives" such as stock options. Contrary to Nobel traditions of choosing awardees for long-standing work in the field of knowledge, the 1997 Prize was offered for work which had immediate practical application in the global market. Ironically enough, the Stockholm Academy may have committed the same error by awarding the medicine Prize to the makers of viagra this year. It took less than a year for the two awardees to be exposed for their "Hedge Fund" engaged in long-term capital management went burst needing a 3.6 billion dollar bail-out. Prof Sen's choice for Nobel Prize marks a return of economic sanity after a long spell of market madness. Today the whole of India should hold its head high in pride.