Prashant points us at yet another interesting, Desi economic history piece by Gautam Bastian. In it, Gautam quotes a provocative Telegraph OpEd that discusses a surprising diversity in the Desi Intellegentsia’s attitudes towards the market. Instead of the uniform, Pavlovian rejection Uncle Milt experienced, the Telegraph’s Ramachandra Guha points at a specific braindrain of Guju econ knowledge -

Back in the Sixties, it used to be said that India’s most successful export were economists. Our economy was resolutely insulated from the rest of the world, but our economists occupied high posts in famous universities in Europe and America. Later, the joke was amended to say that the reason India’s economy was mediocre was because its economists were world-class. No South Korean was a professor of political economy at Cambridge; no Malaysian had been awarded the Nobel Prize. But their economies grew at an impressive 8 per cent, whereas ours stayed stuck at 3.5 per cent, also known as the “Hindu” rate of growth.

My own theory about Indian economists is more specific and hopefully less facetious. It runs as follows; Gujarati economists place faith in the market, while Bengali economists are prone to trust the state. In the Fifties, when P.C. Mahalonobis drafted the Soviet-inspired second five year plan, A.D. Shroff responded by starting the Forum of Free Enterprise. In the Sixties and the Seventies, about the only economist of pedigree advocating Indian integration with the world economy was the Gujarati, Jagdish Bhagwati. He was opposed by an array of Marxists, many of whom (naturally) were Bengali.

As Gautam notes, several prominent thinkers have attacked the the broad question of “if intellectuals are so smart, how come so many have been so wrong about markets?” (Heck, little old me, in my blogging youth tried to add on to Nozick). But by slicing and dicing across socio-cultural lines within India, Guha takes the question in a different direction. While I’d heard the stereotype of Bengali Marxists (keep in mind that my homestate - Kerala - has its fair share as well) I wasn’t aware that Guju’s were responsible for the counter pole. Biz friendly Gujus, eh? I suppose many stereotypes start with a grain of truth somewhere….