Economic Survey 2012: How Kaushik Basu jazzed up the survey

The Economic Survey has never been on the must-grab list of design aficionados, although Chief Economic Adviser Kaushik Basu has taken baby steps to liven up this bland and dense document in the past few years.

Basu, an academic who is on leave from US’ Cornell University where he teaches economics, has during his term as the government’s economics czar given the survey more colour and a thematic underpinning. He has anchored it to the prevailing discourse and used it as a vehicle to send important messages to policymakers.

2009-10

Kaushik Basu’s first economic survey established the government’s intent to reform its policies of distributing subsidies. The cover depicted the Coupons Equilibrium, the foundation of Keynesian microeconomics – which roughly states that giving coupons to a target audience (read poor) is much better than adjusting the market price of a product to benefit them.

2010-11

John Maynard Keynes, the father of modern macroeconomics for many, ruled the cover of the survey again. It featured a graph developed by Nobel laureate John Hicks depicting Keynes’ economic theory on how increasing money supply in the economy through monetary stimulus measures reduces interest rates, leading to higher investments and greater consumption – a series of events experienced in India since 2009-10.

2011-12

Keynes for once did not figure on the cover of this year’s survey. Likely to be Basu’s last, the survey instead depicted the Phillip’s Curve that highlights the trade-offs involved in managing inflation. Basu, who has often spoken about how controlling inflation carries with it collateral costs such as lower wages and increase in incidence of unemployment, has this time used a graph that charts the rationale behind such costs. This graph is also considered worldwide to have accorded political acceptability to inflation. For India, the probable readacross is that high growth and inflation might have to co-exist.