It will take long for Indian economy to come close to China: Avinash Dixit

Avinash Dixit, professor emeritus, Princeton University, believes that it will take decades for India to catch up with China even as the former has better population profile in terms of age than the latter. 

“By 2050, India’s working age population will be bigger and old age population lower than China,” said the professor, while delivering India Policy Forum Lecture. 

He said India’s population distribution is more favourable than China in terms of age. 

“However, demographic dividend in India is handicapped,” Dixit said. 

One of the main reason behind the handicap is the low female labour particapation ratio. While it stands at 27 per cent in India, China is far ahead at 64 per cent. 

The professor, whose research interests include microeconomic theory, game theory, international trade, industrial organisation, growth and development 

theories, public economics, political economy, and the new institutional economics, said synchronisation of elections and allowing states to experiment with laws would improve outcomes in the economy. 

“For improving outcome in India, you could allow states to test which law, rules work and which do not and then choose. 

Look at synchornising elections,” said the economist at the lecture, organised by the National Council of Applied Economic Research. 

Synchronised polls will help voters know what political parties promise at the national, state and local levels.

India’s political process is more dysfunctional than the US, he said. 

Suggesting that corruption should be looked not like cancer, but like a chronic condition, obesity, he  said cooperation in business groups and citizens is better than top down approach to control the menace.

He said poor outcomes in growth are due to poor quality of education, infrastructure and government institutions. 

“India is almost at the level of middle income country, if it wants to improve it will have to improve quality of its institutions,” he said.