In its earlier sit-down avatar on Bull Temple Road, it was known for doling out copious quantities of chutney in buckets. No sooner had you emptied half the chutney on your plate, a waiter would materialize and pour a bucket of the stuff into your plate. The main item on the menu here was the “khali dosa” (not to be confused with “plain dosa”). No sambar no palya no saagu. Just enormous quantities of chutney.
Category: fundaes
On introducing democracy
Ravikiran Rao argues that the reasons most Indian parties are afraid to embrace inner party democracy is that the people who are in charge are afraid that if they introduce democracy and lose the first election, their opponent might destroy the democracy and just keep the power with himself.
Isn’t this the case everywhere? Be it Indian political parties or African countries or even the local club. I mean, if you want to introduce democracy (by which process you are giving away something), you should be convinced that the opponent plays by the rules. However, in most cases, it is tough to find an opponent who is guaranteed to play by the rules. However, if democracy is introduced and works successfully for a few years without anyone trying to misuse it , in that case, it will stay for good.
One implication is that you try to introduce democracy when you know that you will win the first round. Given that you want to introduce democracy means that you aren’t THAT power-hungry and are willing to give away a bit in order to secure long-term systemic gains. Which means that you are likely to play by the rules in your term as power. And once you can ensure that, democracy is likely to get embedded in the system, after which even if you lose one, you know that your opponent won’t be able to do much to blindly hang on to power.
When countries become self-governing after an independence-struggle, the party that is in charge will usually be the one that has led the struggle. And it is usually confident that it can win the first couple of rounds. Hence, most countries that became independent in the 40s to 60s started off as being democracies (that many of their systems have broken down is another story) – it was useful to gain brownie points with the US, UK , etc. and there wasn’t much threat to capture of power.
However, when you have got power through other means – say by some kind of an inorganic process, then there is no guarantee that you will win the first round, or second round, or ever. Hence, you have some countries that came out of the Eastern Bloc and Central Asian countries that have never made an attempt at democracy. The people in power know that once they try to bring in democracy, their power is effectively over.
On a similar note, countries that have moved away from democracy (Zimbabwe immediately springs to mind) have no incentive to bring it back – again the first round victory is not guaranteed. Yes – there have been efforts such as those in Pakistan to reintroduce democracy, but it’s being done under some kind of special circumstances – such as Musharraf’s party not being allowed to contest, etc. Also it has been done under considerable supervision of the US, so self-interests of Musharraf can’t be so blatant.
More on pricing of air tickets
More than a week back, I had written in my blog that the airports need to change the fee structure of user charges, etc. so as to drive the marginal cost down to zero so as to ensure more efficient usage of seat space and better revenue management. It seems like I didn’t? do my research too well. Out of the approx. Rs. 2800 in “fixed charges”, about Rs. 500 only is user charges, the rest being levied by the airlines as “fuel surcharge” (remember that airline fuel isn’t subsidized like petrol or diesel).
Discounting at megamart
Megamart (the discount chain run by Arvind Brands) has a really weird discount policy. Usually, the discounting mechanism that clothing stores follow is progressive discounting – the more you buy the more discount you get. In fact, even Megamart was following this practice a few months back. “Buy one get 20% off; buy two and get 30% off” and so on. This kind of discounting encourages more sales per footfall, and so the discount is worth it.
Marginal cost of flying
The problem with all these 1 rupee – 2 rupee offers in indian aviation is that they aren’t really that cheap. On top of this you have the various taxes and user charges which come up to some Rs. 1500 (I’m not sure of the exact number). What has effectively happened is that these charges have put a floor on the price of airline tickets in India.
Temple food
During my recent pilgrimage, three of my four meals were at temples – two at the Horanadu temple and one at Sringeri. For the fourth meal, we took a conscious decision that a temple meal may not be suitable for an overnight bus journey on a bumpy road, so we ate at a restaurant.
Looking for porn in Sringeri
Now that this half-blasphemous title is out of the way, let me get straight to the point. Actually I think a bit of beating around the bush is warranted. When I read Tyler Cowen’s Discover Your Inner Economist, I wasn’t sure if i would be quoting part of this book on my blog. However, considering that I almost directly applied one of the ideas mentioned in the book, I think it deserves a mention.
SLV Banashankari 2nd Stage
Around this time last year, I was doing a series of blog posts on delivery and revenue management practices in restaurants in Bangalore. My apologies for not updating on that series for so long.
This morning I had my breakfast at SLV in Banashankari 2nd stage (near the BDA complex; opposite the park next to the complex). Despite being within 200 metres of my school, I don’t particularly remember going here too often. This is one of the very old-school darshinis – for a long time, these guys made no dosas. Even the last time I went there (about a year back), they served only idli, vada, kesari bhath and khara bhath. Today, however, I noticed that they were also making masala dosa.
Scrap the spending limit
There are two notable things regarding the ongoing elections in Karnataka. The first is the presence of a large number of real estate developers in the elections. The second is the virtual non-existence of corruption, rather the removal of it, in party manifestos. These two points, I believe, are not independent. Under the current system, political parties are forced to rely on black money to fund election campaigns. For people with black money, election funding is an extremely lucrative investment, and with the right bets or good hedges, can give excellent returns.
The political parties have no way out of this. In the name of austerity, and conserving public money, there is a limit on spending in elections. Currently, it stands at a measly Rs. 10 lakh per candidate. In other words, what the rules say is that no candidate is allowed to spend more than this amount on his campaign. Assuming that the average assembly constituency has about 2 lakh voters (this is the case with Karnataka this time round), this works out to Rs. 5 per voter.
A “normal” election involves considerable expenses – banners and posters and flyers; speeches by national politicians; public meetings; door to door campaigning; rallies (And I’m not even thinking about “illegal expenses” such as buying liquor and saris and crowds). It is obvious that in order to put up a serious campaign, one needs to spend a large multiple of the official limit. There is only one way to fund this – using “black money”.
Notice that even if a particular party wants to be honest, and doesn’t want to use black money, it can’t do so unless it is willing to badly hurt it’s own chances in the elections. There is simply no way out. Yes, you might think of increasing the spending limit, but if the other guy is willing to spend over and above the new limit there isn’t much you can do.
As you might have figured out from the title of this post, my recipe is to scrap the spending limit on elections. It is fairly common knowledge that no one really sticks to these limits. Why not just legalize this? It still won’t stop parties from using unaccounted money. However, it gives the parties an OPTION to be honest, and use only honest sources of money.
If a party wants to go to the polls on an anti-corruption platform, it would be able to do so without being corrupt during the process itself. And once some party takes the plunge and “goes honest”, the other parties are likely to follow soon, unless they can afford to lose their reputation. And where will “honest” political parties get their funding from? I’m sure there is a large number of businesses who stand to benefit a lot from a corruption-free government. It shouldn’t be a problem to tap them for funds.
I concede that it’s not a foolproof solution. There is no guarantee that there will be some party which will take the bait and go “all white”. Even if one party does so, there is no guarantee that the entire flawed system can be cleaned up. However, this proposal doesn’t cost too much. I can see no real negative aspects of removing the cap (if you can think of anything, please let me know in the comments). It is definitely worth a try. It is definitely superior to give people the choice to be honest, rather than forcing them to be dishonest.
Cross posted at the Indian Economy Blog
Rice prices
Recently, Tyler Cowen wrote in the New York Times saying that lack of free trade in rice and growing protectionism is not a good thing from the long-term perspective.
IAS Officer Gulzar Natarajan (now with the Vijayawada Municipal Corporation) took him on and elaborated as to why protectionism might be necessary.
I left the following comment on Gulzar’s blog. Given that I’m not blogging much nowadays, and I almost wrote an essay over there, I reproduce here that comment in full.
“trade” doesn’t necessarily mean foreign trade. it can also stand for trade within the country. and this is essential in order to “send out the right signals”.
basic thing is that we need to ensure that farmers receive a fair price for the rice they grow. given that the total demand for rice is increasing, it is only fair that the farmer sees this increasing demand by way of higher rice prices. higher rice prices (as realized by hte farmer) will lead to increase in production which can combat the growign demand.
international trade is one thing. the bigger problem lies with the procurement of goods such as rice by the governments. a number of countries don’t allow the farmer to sell to the open market. procurement is highly controlled, and despite the rising prices, the farmer gets none of it. and thus has no incentive to grow more.
yes, a country might ban exports because it feels that the rice available is enough only to feed its own population. however, this shouldn’t be done at the farmers’ cost. and they should be able to see the right demand for the commodity so that they can adjust.