Jagdish Bhagwati is university professor of economics at Columbia University. He is the author of several books including "In Defense of Globalisation". His latest book, "India's Tryst with Destiny: Debunking Myths that Undermine Progress and Addressing New Challenges", which he has co-authored with Arvind Panagariya, a professor of Indian economics at Columbia University, argues that growth can reduce poverty and that slow economic growth will hurt social development. In their book, revive the Kerala Model vs Gujarat debate and attack economists such as Nobel laureate Amartya Sen for his "anti-growth assertions".
Why do you want to compare the Kerala model of development with the Gujarat model of development?"Kerala Model" in our book is a metaphor for a primarily redistribution and statedriven development while "Gujarat Model" is the metaphor for a primarily growth and private-entrepreneurship driven development. As such the Kerala Model vs. Gujarat Model debate is a longstanding one. We show in our book, "India's Tryst with Destiny," that it is ultimately the Gujarat Model that has delivered in Kerala. Contrary to common claims, Kerala has been a rapidly growing state in the post-Independence era, which is the reason it ranks fourth among the larger states, according to per-capita gross state domestic product and first according to per-capita expenditure.
It also suffers from the highest level of inequality among the larger states. So growth, and not redistribution, largely explains low levels of poverty. In health, Kerala's per-capita private expenditures are nearly eight times its percapita public expenditures. In education, excluding two or three tiny northeastern states, at 53%, rural Kerala has by far the highest proportion of students between ages 7 and 16 in private schools. The nearest rival, rural Haryana, has 40% of these students in private schools.
Kerala's social indicators are still high and there isn't much gender bias in both health and education. On the other hand, in Gujarat, the female and male infant mortality rates stood at 51 and 44, respectively, in 2010-11 (The corresponding national figures were 49 and 46, respectively).
No one would question the superior levels of social indicators in Kerala compared with any other state in India, let alone Gujarat. But what does that have to do with the Kerala Model? Kerala simply started at very high levels of social indicators than the rest of the country and it has maintained that lead. In 1951, literacy rate was 47% in Kerala compared with just 18% in India and 22% in Gujarat.
As for the infant mortality rate (IMR), in 1971, the earliest year for which we have comparable data, it was 58 per thousand live births in Kerala, 129 in India and as high as 144 in Gujarat. Even the male-female differences you cite date back to pre-Independence era. The right question to ask is whether the Kerala Model produced perceptibly superior gains (as opposed to superior levels, which were inherited at Independence) in social indicators. The answer to this question turns out to be mostly negative, as we demonstrate in our book.
The people of Kerala aren't perceived to be as entrepreneurial as Gujaratis are. Is it just a problem of perception? Does it mean that what suited Gujarat wouldn't suit Kerala and vice-versa?
It is wrong to argue that Keralites are not entrepreneurial. In fact, we show in our book that they have had a long history of commercialisation and globalisation via trade and that the resulting prosperity is a key explanation of the high social indicators they inherited at Independence. Today also, with the long-standing inherited preference for education, skilled Kerala migrants can be found everywhere. Astonishingly one in three households in both rural and urban Kerala has at least one member living abroad. It is not surprising therefore that remittances have pushed Kerala to the top in terms of per-capita household expenditures despite its fourth rank according to per-capita gross state domestic product.
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