A history of Indian misery
A Mint index of economic misery shows any sharp increase in economic misery is accompanied by dramatic changes in political landscape
One of the most striking features of the 2014 election campaign was its focus on economics. The sharp slowdown in economic growth over the past few years, persistently high inflation and the rise of a more aware electorate may have brought economics to the centre stage this year but the influence of economic forces on politics is not entirely new or unprecedented. The history of politics suggests that political upheavals have often tended to coincide with economic misfortunes.
A Mint index of economic misery, dating back to the 1960s, shows any sharp increase in economic misery is accompanied by dramatic changes in the political landscape. While small economic changes do not seem to impact the polity deeply, big reversals in the country’s economic fortunes seem to alter political equations dramatically.
The Mint misery index is a proprietary index that provides a summary measure of how high inflation is and how low growth in gross domestic product (GDP) is in a particular time period. Lower the growth and higher the inflation, higher is the index value, which has been normalized to take values between 0 and 1, with 1 indicating the height of misery and 0 the point of perfect bliss.
The index is inspired by the American economist Arthur Okun’s misery index. Okun created a simple numerical measure to quantify how economic conditions affect citizens. He added up the unemployment and inflation rates in the US to develop a misery index for that country. It has been quite popular over the years in political analysis as it can be used to measure how well average citizens have done under various US presidents.
Unlike the US, data on unemployment in India is infrequent, and may even be misleading. Employment may rise during economic downturns as more women join the workforce to take up informal jobs, only to quit during a recovery. Given that a shrinking economy tends to restrict opportunities for everybody, (the lack of) economic growth has been included in the Mint misery index to reflect the decline of opportunities.
The trajectory of the Mint misery index over the past five decades seems to track the changing contours of the country’s polity. To be sure, it will be unwise to reduce all political upheavals to changes in the economy. There are many drivers of politics, and economics is only one of them. Nonetheless, the parallels between the spikes in the Mint misery index and the changes in India’s political landscape over the course of Indian history are striking.
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