“History shows that where ethics and economics come in conflict, victory is always with economics. Vested interests have never been known to have willingly divested themselves unless there was sufficient force to compel them.”-Dr. B.R. Ambedkar
Dr. Ambedkar is a personality that has an impressive footprint in the history of modern India. What we all know about him is that he was the one who worked extensively hard to give India a better Constitution which must deal with all the contemporary problems of the country. We know him as a learned jurist, a freedom fighter, a man who stands and fight for the people of India and especially for the Untouchables and downtrodden. This is what we have been told since childhood. Unfortunately, what we were not been told was that he was the Economist both by heart and by profession until he entered the social and political life. What is the reason behind such a grave mistake, that is altogether a different matter? The people of India had been very unfortunate in this regard. There is no hesitation in saying that WE THE PEOPLE OF INDIA have not done ‘Justice’ to the personality who fought throughout his life for the Justice, by not celebrating him as an Indian Economist.
B.R. Ambedkar does not require any introduction, his name is enough to understand the greatness of this great man. But we think there are some little-known facts, which should be discussed here.
Ambedkar’s original name was Ambavadekar, it was his teacher, Mahadev Ambedkar who changed his name in school records from Ambavadekar to Ambedkar.
Not only Ambedkar is the first Indian to pursue an Economics doctorate degree abroad, but he is also the first Ph.D. in Economics and the first double doctorate holder in Economics in South Asia. He was also among the highest-educated Indians of his generation.
He played an important role in the establishment of the Reserve Bank of India in 1935.
The Mahad Satyagraha(1927) was his first important crusade.
The change in the working hours in India from 14 hours to 8 hours was done by Dr. Ambedkar.
His autobiography is used as a textbook at Columbia University.
Dr. Ambedkar opposed Article 370 of the Indian constitution.
He was the main force and fought for 3 years to get the comprehensive Hindu Code Bill passed by which women got several important rights.
Dr. Ambedkar was the first to suggest the division of Bihar and Madhya Pradesh.
His efforts were pioneering in the development of India’s national policy for water and electricity.
Ambedkar as an economist-
He worked extensively on contemporary economic problems during his days as a student. He earned a Master’s degree and Ph.D. in economics from Columbia University, the USA in 1915 and 1917 respectively. His pragmatic approach toward the Indian Economy could be understood from the first time in his 42- page research paper namely ‘Administration and finance of the East India Company as the dissertation for his M.A.(Economics) degree in 1915. This was the first account where Dr. Ambedkar had shown the world his mettle. His thoughts in this book reflected the historical account of the administration and finances of the East India Company and brought out economic and legal implications that ran counter to the interest of Indians.
For his first writing, he marshaled the data from 1792-93 to 1857-58 which shows that the economic policies of Britain had been ruinous for the masses. He brought to the focus of the world the dual face and policies of Britishers when he critically analyzed the difference between what the 1858 Act talks about and what the Britishers did. He opined in this research paper how the entire debt accumulated by the East India Company during the conquest of India was simply transferred to the people conquered, who were already reeling under destruction and poverty when the Company raj ended. He was equally concerned about the issue of wealth drainage from the country to Britain like Dadabhai Naoroji who was the flag bearer of the criticism of the unfair policies of British rule. Ambedkar did opine on many issues but he was the man who believes in action. He always gave suggestions on the issues he raised.
In his opinion finance of a country is to be judged from the viewpoint of development expenditure and within its public works. But the record of the Britishers on this front was terrible. He also criticized the expenditures of the Britishers on foreign wars in the service of the Empire.
Another service to India was his Ph.D. thesis namely, ‘The Evolution of The Public Finance in British India’ in 1917 which was later published in book form in 1925. It was considered to be a basic contribution to the theory of public finance. He analyzed the relationship between the Centre and the Provinces from 1823 to 1921. He identified the main reason as the diarchy where the law-making and revenue collecting powers were concentrated at the Centre but it was the provinces that were primarily responsible for most of the public expenditure. This was a great contribution to public finance and more specifically to the theory of federal finance. He laid down the basic principles which later helped the country to establish the Finance Commission of India after independence.
In this book, he also brought forth the flaws in the revenue policies of British rule. The burden of taxation fell mainly on the poor instead of the rich and the public expenditure was geared towards maintaining the privileges and conspicuous consumption of the elite instead of public welfare. He also pointed out that due to the extraction policies of the British and flawed taxation policies, the base of taxpayers was shrinking and it was a major reason for the shortfall in revenue collection.
He was a firm believer in India having a better currency system according to the economic situation of the Country. Dr. Ambedkar’s third highly celebrated book is ‘The Problem of Rupee: its origin and its solution’. The second edition of the book was published in 1947. In this book, he delved into the evolution of the currency system in India. Ambedkar was interested in the stability of the value of the currency. He argued that nothing stabilizes the currency without stabilizing its purchase power. While giving the idea of an Indian currency system he sharply differs from the idea of John Maynard Keynes in this regard.
Ambedkar argued in favor of Gold-standard whereas Keynes was of the view that the Gold-exchange standard would be best for Indian conditions. Ambedkar supported his views with the argument that in this system the supply of currency cannot be so easily made and as such it better ensures the stability of prices so that poorer sections would get relief. In short, Ambedkar’s conclusion is clearly toward price stability through conservative and automatic monetary management.
The poor and underprivileged were at the center of Ambedkar’s idea whereas the idea of Keynes was more related to the rich ones. For devaluation, he favored a moderate devaluation which would be beneficial to the cause of the Indian Industry. His views in this book show that he was the authority on economic policy and currency problems.
Contributions to India in the area of economics-
The problem of Rupee: Gold Standard versus Gold Exchange Standard
Contributions to Public Finance-
(a) Evolution of Provincial Finance in British India
(b) Abolition of Khoti System
(c) Ambedkar‟s Canons of Public Expenditure
3. Contribution in Agriculture Economics: Problem of Small Holdings in India
4. Caste system is the major hurdle in the economic development of India
5. Other Contributions to the Economic Development of India
(a) New water and power policy
(b) Contributions to labor laws
(c) State Socialism
Conclusion-
Dr. B.R.Ambedkar with double doctorate degrees was the highest intellectual person of his time. He was a highly trained economist but the problem was that his contributions to economics were not recognized in mainstream economics. The main reason behind this was that Babasaheb stopped practicing economics after India got independence and devoted most of his time to politics and law. Therefore, he got more popularity as a political leader rather than as an economist. But whatever he has contributed to the field of economics is remarkable and should be appreciated.
This article has discussed the important contributions made by Ambedkar in the field of economics. He discussed in detail the evolution of provincial finance under British rule. While discussing how to spend the public funds he said that the spending should be based on the rules and regulations because the public has immense faith in government thus it should wisely use these funds in order to achieve the optimal results.
Dr. Ambedkar was in favor of the consolidation of small landholdings in India by the state and without any discrimination, it should distribute this consolidated land into a standard size to the original cultivators. He suggested that the land is only one factor of production, it is the mixture of all the factors which is responsible for the low production of the land. Dr. Ambedkar wanted that heavy industries should be owned by the public sector and the private sector should only fill the gaps. He was a strong supporter of State Socialism.
He said the caste system is a hindrance and this hindrance in the mobility of labor due to the caste system directly impacts the economic development of India. And there were many other contributions of Babasaheb whether it was the development of multipurpose water and power projects, restructuring the labor laws or women empowerment, all are imperative in the economic development of India.
