India's Amartya Sen Wins Nobel Economics Prize

[Rakesh Bhandari]

Of course Sen's analysis of how one hundred million women are missing
alone makes him a most important academic. Here he discusses how due to
the devaluation of women's labor and exclusion from productive employment
there has been a social sanction of female infanticide and starvation of
female infants.From the Middle East to North India to China this has meant
the death of one hundred million persons, he reasons. Truly one of the
greatest barbarities of the modern world.  This was in a New York Review
of Books not so long ago along with his important analysis of the
possibilities of reducing birth rates without resort to coercion. 

Sen's contribution to global feminism alone seems to justify the prize. 

Here are some of my notes from the analysis of Sen's book on famines by
Meghnad Desai "Story telling and formalism in economics: the instance of
famine", International Social Science Journal August 1987. 

Sen's study of famines traces how due to high food prices in a famine
there is lower effective demand, that is shrinkng markets, for non food
products. He traces this effect on non food agricultural producers in four
famines: 1943 Great Bengal Famine, the Ethiopan famine of 1972-4, the
Bangladesh famine of 174, the Sahel drought and famine of 1969-74. 

Sen also explores the problem of entitlements; that is, it is not enough
for groups to migrate where there may be food. Special action is needed to
restore entitlements. Sen is especially interested in the development of
entitlements which are independent of ownership or any other endowment
except birth in a certain community, and wants to show that market
transactions are not the only nor the natural set of economic relations:
they are one among a variety of arrangements for allocating entitlements. 

As for the theoretical point, Desai writes: "In the pure Walrasian case,
entitlements are assumed to be secure in a trade independent way, i.e.,
the possibility of starvation death due to an inability to buy sufficient
food in exchange for whatever one to sell is ruled out. The theorist does
this to rule out awkward in the formal proof construction, ust as the
theory rules out the possibility of the bankruptcy for firms. Such ruling
out is not dne with any idea that usch things do not happen in teh real
world, but that they
are either too unimportant to worry about (they happen rarely or in a
neglible proportion of cases) or that they introduce complications which
require further elaboration. Thus, for instance, if one were to introduce
minimum subsistence for consumers as necessary condition for equilibrium,
discontinuities enter and make mathematical proofs difficult. 

"But what for general equilibrium theorists is an anomaly or a curiosity
to be ruled out is the central problem to be investigated in famines
i.e. precisely the fact that minimum subsistence quantities are necessary
for survival, but impossible to obtain for a sizeable number of people.
The pure economic model of competitive equilibrium cannot handle this any
more than than it can handle the phenomenon of involuntary unemployment.
To rule it out or to minimize its importance by labelling it an anomaly
does not make the problem go away."

best rb