“An Israeli day care centre found that parents were picking up
their children too late, so they introduced a small charge of $3 to try and
disincentivise lateness. However, instead of discouraging this behaviour, the
payment served to legitimize it and buy the parents piece of mind. The result
was that lateness actually increased. “ (Source:
Unlearning economics)
This example is used by some economists to suggest that
incentives impact the economic behavior of people. They argue that people
actually face three different types of incentives: economic, moral and social.
In the above cited example, the charges "substituted an economic incentive
for a moral incentive (the guilt)", with the implication that the daycare
centre simply didn't get the amount right.
In his recent statements Prime Minister Manmohan Singh has urged
the fellow citizens to control the consumption of fuel and gold. Previously,
finance minister P. Chidambaram and RBI governor Subbarao have also made
appeals to curb gold consumption.
There are suggestions to increase the diesel price substantially
to incentivize economical use of transportation fuel. Similarly, various
disincentives have been introduced to curb consumption of gold.
The mute question is whether these monetary disincentives will
work as moral incentives and encourage guilt free consumption?
On political side, curious to find the popular appeal of our
political leaders, we did an impromptu check with people across seven states.
The response was that of outright rejection, no-trust and disbelief.
The following two responses are especially notable.
(a)
The present leadership is no comparison to the genuine Congress leadership. During 1965
war with Pakistan, the then Prime Minister Lal Bahadur Shastri urged people to
give away one meal so that starving poor could be fed. Many people gave up two
meals instead. A large number of families still carry the tradition by
observing fast once a week. People did that because they totally believed in
their leadership. But today no one seems to have faith in the country’s
leadership. Squabbling within the government is not helping the situation
either. (A 74year old Congressmen from
Lucknow)
(b)
Dr Manmohan Singh shares many similarities with Lal
Bahadur Shastri. Both come from a very humble family background. Both have a
austere life style and simple habits. Both believe in socialism with greater
degree of private participation. Lal Bahadur Shastri initiated green revolution
and white revolution. Manmohan Singh is widely credited with unleashing
industry from the clutches of unproductive control and financial sector refoms.
However, unfortunately the similarities end there. Shastri
bravely fought the wars – against enemy (Pakistan), nature (drought) and within
the party – and won. Manmohan Singh on most occasions appeared helpless,
escapist, withdrawn and compromising. (A Law professor from Haryana)
Thought for the day
“You are not only responsible for what you say, but also for what you do not say.”
- Martin Luther (Germany, 1483-1546)
- Martin Luther (Germany, 1483-1546)
Word of the day
Pari passu (adv)
With equal pace or progress; side by side.
(Source: Dictionary.com)
Shri Nārada Uvāca
Agenda 2014-2019
1. A law to establish right to health security for all, with provisions for treatment abroad where needed!
2. A law to establish right to have pucca house.
3. A law to establish right to proper clothing.
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