People want a free-market economy

Niranjan Rajadhyaksha has a very good piece in today’s mint. The following are some of forgotten facts in development economics in India. 

• “The poor are either ignored or patronized, crushed or pitied. Few seem to believe that these people are capable of helping themselves if they are given the right opportunities. It reminds me of the critique of development economics by Peter Thomas Bauer where people were treated as “lifeless bricks to be moved around by some master builder”. That attitude has not changed. 
  
• Bauer himself was a great believer in direct observation. His studies on the rise of cash crops in countries such as Malaysia and Ghana involved a lot of field work. He showed that farmers in these countries were quite able to take the long view and plant cash crops that took years before they yielded any revenues; they responded to price signals; they had an instinctive understanding of risk. 
  
• The poor show surprising sophistication when dealing with finances. “…we came to understand that money management is, for the poor, a fundamental and well understood part of everyday life,” the four authors say in the introduction.”