The role of ideas in India's economic reforms

The dissertation highlights the role of ideological change among Indian intellectuals in bringing about and sustaining India's economic liberalization in the 1990s. Recent advances in behavioral economics, public choice and new institutional economics have stressed the role of ideology in shaping the economic policies and outcomes of societies. Two kinds of evidence presented here indicate that there was an ideological change in favor of businessmen and profit-making in India. Popular Bollywood films have come to portray businessmen more sympathetically over time. In the 1950s traders and merchants were inevitable shown as corrupt and wicked. In 1980s, the most common occupation of the hero of the film was that of a businessman.;The economics discourse in India's leading newspaper after the balance of payments crises of 1966 and1991 is also examined. The content analysis of news articles in 1966 reveals that the paper placed the blame for the currency crisis and resultant recession and inflation on private businesses and the World Bank. In 1991 the newspaper discourse implicated the government spending, inefficiency in the public sector, and restrictions on foreign investment. The macroeconomics indicators relevant to the crisis were not very different in 1991 compared to 1966. The difference in discourse and the underlying ideology, it is argued here, explains why India's policies in response to the 1966 crisis were more interventionist, while those in response to 1991 crisis were more liberal.