Sunday, August 19, 2007

Nitin Pai on India's quest for excellence


In a commentary on Prime Minister Manmohan Singh's musings on the eve of the 60th anniversary of India's Independence, Nitin Pai says that India's quest for excellence -- as articulated by the PM -- is doomed to failure. You and I may think that factors such as corruption, lack of resources, "chalta hai" attitude (that the PM himself "despairs of") or religious intolerance and fundamentalism might be among the key factors holding India back. But, no. According to Nitin, one factor trumps everything else: reservation (aka quotas).

... [This PM's] government has done nothing to improve the incentives for excellence. Why would a marginal student aspire to be in the top 5% of the class if reservations guaranteed that person a place in an engineering college as long as he made the ‘cut-off’ for his community? And why would the marginal student in the engineering college attempt to score top grades, when quotas guarantee a government job? And why would the marginal government employee strive for excellence if promotions can be had with far less effort, as long as there is a quota?

If you are a pro-reservation fellow like me, you probably want to go "Grrrrr", and I certainly do. But I realize that I have to go beyond making angry, guttural noises (not necessarily because of this post!); so, I will try to offer some evidence for my side, and leave it to Nitin to offer some evidence for his side.

But wait a minute! I have already given my reasons for supporting quotas. More than 15 months ago, over at How the Other Half Lives. Here's a quick summary: in spite of the 'burden' of reservation, (a) our public sector companies -- particularly banks -- are flourishing in the face of de-licensing and unfettered competition, and (b) the southern states -- and in particular Tamil Nadu, the state with the highest level of quotas -- have also done quite well -- if not better than the rest of the country. Finally, I also pointed out that the dramatic turn-around of our Railways in just two or three years is a clear indication that the primary responsibility for its former state of inefficiency and sloth must be somewhere else.

Nitin goes on to tell us about the private sector:

Mercifully, there is no ‘chalta hai’ attitude in the private sector, especially in those segments that have been opened to global competition. That’s one part of India that is indeed striving for global excellence. But why would a marginal employee in a private sector factory strive for excellence when he knows that it’s virtually impossible to sack him for underperformance. ...

Does anyone remember all these enterprises: Maxworth and Sterling, Malavika Steels and M.S. Shoes, Himachal Futuristic and Pentamedia Graphics, Pertech Computers and D-Squared Software? In a famous article, Swaminathan Aiyar talked about the decline of many enterprises run by the Birla and Modi clans. What happened to these eminently quota-free companies? What caused their decline? Quotas? Or, incompetence, corruption and greed?

Don't get me wrong here. I am not against the private sector, nor am I an apologist for the public one. The simple point is that when our country faces many complex problems, attributing them to One Single Cause is naive at best and disingenuous at worst.

Let me also add here that one could be against reservation for other valid reasons -- for example, the way it is implemented, who gets in and who's kept out, the level of quotas, its seemingly sunset-free status, etc. But to attribute to quotas all kinds of problems is not just sloppy thinking, but also a misdiagnosis of the causes. And that is no help, especially coming from someone writing at a site called "National Interest."

* * *

When I say that the southern states are doing quite well compared to the rest of the country [just a month ago, Outlook devoted an entire issue to "Dakshin Rising"], I am not arguing that they are repositories of excellence. Yet. I am just arguing that they are a lot closer to 'excellence' than the other parts of India. At the least, then, their march towards excellence has not been hindered by reservation. Some might say that quotas actually boosted their economic and social development; but I will take the lesser claim -- that quotas have not come in the way -- since that is enough to counter Nitin's argument that quotas actively harm progress.

[Aside: For an indication of the low morale of the South at the time of India's Independence, take a look at this article by E.V. Ramasami (aka 'Periyar') reproduced in the Hindu special supplement for India's 60th birthday. In it, Periyar used the possibility of domination by the north and its industrialists to argue that the South should secede from India! Even as I was growing up in the sixties and seventies, "Vadakku vazhgirathu, Therrku theigirathu" -- "North flourishes, even as South perishes" -- was a slogan repeated so often in public meetings of the Dravidian parties. Thus, one could argue that the South has traversed a greater distance during the last sixty years (at least on the confidence scale!), much of which has seen pretty high levels of reservation.]

22 Comments:

  1. Rahul Siddharthan said...

    Another observation: I know numerous cases (I am one myself) of people from south Indian families who grew up in the north because their parents moved there, then themselves moved back to the south. The original move to the north was, in many cases, related to reservations and the difficulty of getting a government job (and the fear that the kids would not get a college seat). The move back to the south, I think, is related to the positive spin-offs of reservations that you mention, that have boosted the south generally.

  2. Pratik . said...

    Agreed reservations can in no way be singled out as the sole flaw in the system. But, that still doesnt answer the "whys" in Nitin Pais article.

    And yeah, while Birla sinks, Tata steel soars above SAIL.

    I dont mean to say that reservations can be singled out as the sole cause; and I do concur that the way they are implemented leaves a lot to be desired.

    Possibly that, more than anything else, is what a large chunk of anti-reservationists try to get across. And possibly that is what a number of pro-reservationist would readily concede. Just that different groups seem to couch them in different, and rather stringent languages

  3. Anonymous said...

    Dear Abi,

    As you write, much of the pro- and anti-reservations debate is out there, so I'll just address the bit about the private sector:

    You wrote:
    Does anyone remember all these enterprises: Maxworth and Sterling, Malavika Steels and M.S. Shoes, Himachal Futuristic and Pentamedia Graphics, Pertech Computers and D-Squared Software? In a famous article, Swaminathan Aiyar talked about the decline of many enterprises run by the Birla and Modi clans. What happened to these eminently quota-free companies? What caused their decline? Quotas? Or, incompetence, corruption and greed?


    Very good point. Nobody remembers them anymore. The price of incompetence, corruption and greed in the private sector is an uncelebrated demise. Their shareholders will probably be wiser, but that's their problem. No tears need be shed. Good riddance to them. I'd say that if they are allowed to linger on to exhibit their incompetence, corruption and greed for a day more than necessary, then it's because our government prevents it.

    Contrast that with the number incompetent, corrupt and wasteful public-sector outfits. Their incompetence, corruption and greed lingers on long after the date they should be dead, reminding us of their wasteful existence every single day. And guess who pay to keep them alive---us. And unlike shareholders in private firms, those who don't want to throw good money after bad can't say no.

    That's why we remember them.

  4. Anonymous said...

    Sorry---the paragraph should read:

    Nobody remembers them anymore. The price of incompetence, corruption and greed in the private sector is an uncelebrated demise. Good riddance to them. Their shareholders will probably be wiser, but that's their problem. No tears need be shed. I'd say that if they are allowed to linger on to exhibit their incompetence, corruption and greed for a day more than necessary, then it's because our government prevents their closedown.

  5. Anonymous said...

    //Why would a marginal student aspire to be in the top 5% of the class if reservations guaranteed that person a place in an engineering college as long as he made the ‘cut-off’ for his community?//

    To get the college of his choice and course of his choice....

    To get into COmp Science in Anna University, the difference between OC, BC and MBC cut offs are marginal

    Same for Medical Colleges also

    Does this gentleman know that the cut off for MBBS in tamil Nadu (with history of reservation for decades)


    // And why would the marginal student in the engineering college attempt to score top grades, when quotas guarantee a government job? //

    To get the job of his choice and place of his choice

    //And why would the marginal government employee strive for excellence if promotions can be had with far less effort, as long as there is a quota?//

    This is the most stupid argument i have seen (of course most - though not all - of anti reservation arguments are stupid)

    Promotion irrespective of performance is guaranteed for EVERY ONE IRRESPECTIVE OF QUOTAs....

  6. Anonymous said...

    Tamil Nadu Cut Off in MBBS

    General - 97.75%
    BC - 97 %
    MBC - 95.5%
    SC - 94 %
    ST - 90 %

    Can Nitin Explain what is marginal........

    This is what happens when you give reservation ....

  7. Abi said...

    Rahul, Pratik, Nitin, Bruno: Thanks for your comments.

    Rahul: I haven't thought about the reverse migration of people who left the South a long time ago. Now that you mention it, it *is* interesting.

    Pratik: I'm sorry to disagree with you on this one; some people did complain about the implementation details, but many, many others objected to reservation as a matter of policy. The latter type of opposition is ideology driven.

    Nitin: Some public sector companies are incompetent, while others flourish. But what does *that* got to do with reservation? You are not saying that the failed ones had a high level of quotas, are you? ;-)

    Bruno: Thanks for sharing those numbers. Are they for this year?

  8. Anonymous said...

    Abi,

    With regard to your point (b): how do you know Tamil Nadu would not have done at least as well in the absence of reservations?

    Essentially, you are asking a "counterfactual" question: what would TN look like today if reservations had not been followed? The answer to this question depends on the alternative policy that would have been followed. Typically, those supporting reservations (like yourself) assume that the alternative to reservations is "no redistributive policy whatsoever" but this is an extreme assumption, as you will note yourself.

    The point, I think needs to be noted is that some of the southern states were among the better-off in social indicators (like literacy) for quite a long time, even going prior to independence. It is quite likely that, today, they would be better-off vis-a-vis their northern counterparts even if reservations had not been implemented.

    If you want to push the argument that TN has done better because of reservations, you have to do the following: Consider the "most plausible" alternative policy that TN would have followed if it had not chosen reservations. Then, argue that this alternate policy could not have delivered the results that TN has managed today by following reservations. This is not an easy exercise and has not been done, to the best of my knowledge.

    In general, answering counterfactual questions is not easy. Unfortunately, such questions crop up all too often in social sciences. Natural Science, of course, has a powerful tool to answer counterfactuals: "controlled experiments."

    Suresh.

  9. Anonymous said...

    Bruno,

    I am reminded of the following anecdote due to my friend who is a teacher in one of the Delhi University colleges. Every year, she told me, parents come to her and her colleagues pleading for their wards who have missed the cutoff by something like 0.5%. The answer to such pleas for special consideration, typically, is that between 88% and 88.5% (say, the cutoff), there are somewhere between 50-60 students and if one is admitted, then all others will have to be admitted as well.

    The point is that the bare cut-off percentage may be hiding a lot of relevant information. How many students are in that narrow band of 97-97.5%? Given the type of mark inflation that seems prevalent in Tamil Nadu - I have to say that my information is secondary based on what others have told me - this may not be a small number. I would also be curious to know the other statistics - mean, median, standard deviation, etc. - of the general and other category candidates. If this data is available (particularly a time-series), one could have some fun (academically speaking) analysing it.

    Suresh.

  10. Anonymous said...

    Dear Bruno,

    Thanks for the data. The first thing they suggest is that a life without reservations might have helped those it was intended to benefit.

    Secondly, I knew many 'shooting off the hips' bloggers (not Abi) would misread the meaning of the word marginal. That's why I linked to the Wikipedia entry on my blog (this did not appear when Abi quoted from it).

    Third, the TN scene does not reflect the national picture. Yet, reservations are a national policy. Therein lies the rub. Words like minority, discrimination, backward etc are location, time and context specific. A national policy is therefore a very very blunt instrument, to put it mildly.

    Fourth, I'm not sufficiently familiar with the current cut-offs for Engineering and Medical colleges. If the cut-offs are similar, and it's harder for those with reservations to get a seat, then it only proves that the reservations need to go.

    But the problem of incentives will remain valid wherever the cut-offs are different; the higher the difference in the cut-offs the greater the differences in incentives.

  11. Anonymous said...

    Dear Abi,

    Some public sector companies are incompetent, while others flourish. But what does *that* got to do with reservation? You are not saying that the failed ones had a high level of quotas, are you?

    The topic was about "excellence" remember? My point is that excellence needs incentives; for the private sector, competition acts as an incentive---perform or perish. Where the public sector does not have those incentives, it produces shoddy stuff, or is kept on articifical life-support at the tax-payers' expense. The lack of incentives abounds within public-sector organisations too. Reservations is one. And as Bruno points out, careerism (promotion by seniority) is another.

    So if a private company thinks that it can compete and make profits by promoting on seniority or by job quotas, then by all means it should do so. It is a private decision. Those that don't think this will help them survive and make profits should be allowed to take their own way.

  12. Abi said...

    Suresh: The counterfactual is an interesting exercise, and I would proceed to answer it the following way. I would argue that, in the absence of reservation, the south would have been no different from the rest of the country. To argue that the south would have had a superior developmental trajectory (compared to the rest of India) would require us to assume other things about relative levels of efficiency, work ethic and entrepreneurial spirit. And wisdom too to redistribute the fruits of a faster development! I don't think one can really muster evidence for those! Are the southerners particularly more efficient, entrepreneurial or hard working than those in other parts of the country?

    I am curious about your view that the south enjoyed better social indicators at the time of independence. Can you provide some links?

    I linked to the article by Periyar to indicate the low esteem in which the southerners held themselves vis-a-vis the north. It's possible that his sense of 'siege' was a political ploy, but people did relate to it at some level.

    Nitin: You said, "The topic was about 'excellence' remember?" While the discussion is broadly about excellence, this post is really about your extraordinary assertion -- unsubstantiated so far -- that quotas harm progress, and quota candidates need not be competitive (because there aren't incentives for them to excel). All I have done here is to point out public sector successes that contradict your assertion. I used the private sector failures for disproving the related assertion that private -- quota-free -- sector is all fantabulous. Both, together, just tell me that reservation cannot be the culprit that comes in the way of progress towards excellence.

    Once again, Nitin, extraordinary assertions need extraordinary evidence. I'm still waiting ...

    Both Bruno and I keep using TN experience as an example because (a) that's the state for which data on admissions are available, and (b) it's also the state with extreme levels -- 69 percent -- of reservation over a far longer period than any other state in the country. The data Bruno provided tell you that the last student (marginal student in your sense of the term) to get into a top college in the general category and the last student in the reserved categories are not very different in terms of marks (I admit that the rank difference would be quite substantial).

    Here's a more interesting statistic: over the last three years, OBC, SC and ST students in TN have made it to the Open Category seats in huge numbers (over 75 percent of the general category seats; see links this post and the comments therein). This again is meant to disprove your assertion that reserved category candidates are not (or, need not be) competitive.

  13. Anonymous said...

    Abi,

    With all due respect, you do not convince me. Let me explain it as follows. Suppose TN and the North were more-or-less comparable 80 years back when the reservations policy began in earnest in Tamil Nadu. Then, a comparison of TN and the North would provide a direct test of the efficacy of the reservations policy. You would then be correct to assert that to believe that the superior TN outcome is due to something other than reservations "would require us to assume other things about relative levels of efficiency, work ethic and entrepreneurial spirit."

    Note, however, that your argument would not hold if the South and the North were not comparable 80 years back. For instance, suppose the South was richer than the North 80 years back. (I am not saying that this was the case.) Then, the fact that TN is richer now does not say anything about the efficacy of the reservations policy since the initial conditions in the two regions were different. One has to devise a more sophisticated method to test whether or not the reservations policy was effective. (This, in some sense, is what econometrics is about.)

    The argument thus comes down to whether the South was comparable with the North about 80 years back. I am looking for data on social indicators by region and year to see this. Not too successful; however, Joseph Schwartzberg's wonderful "A Historical Atlas of South Asia" contains some information. In particular, it would appear that there were differences in literacy rates between Kerala & TN and the North (the BIMARU states) going a long way back. The atlas is online at

    http://dsal.uchicago.edu/reference/schwartzberg/

    Take a look at page 103 which traces the evolution of literacy. Note that the darker shaded regions (the more literate parts) are mainly in the south, west and east. Note also that Burma and Sri Lanka outperformed us even going back to 1901 or earlier. If I get more information, I will share it on this forum.

    Suresh.

  14. Abi said...

    Suresh: Let me clarify: I did *not* make any special claims about the efficacy of reservations here. If, only if, I did that, I would need to use the south's better performance as an evidence to support that case.

    I am refuting a different assertion -- the one made by Nitin -- that quotas harm progress. For this, it is enough for me to show that the south is doing about as well as the rest of the country, and I would have been quite happy to settle for this claim. In the event, the south is doing slightly better. That's about it.

    In fact, if you look at things at a disaggregated level, you would find Punjab and Haryana doing far better than the south!

    Thanks for that link! It looks really fascinating.

  15. Anonymous said...

    Abi,

    The question that you are asking - do quotas harm progress? - is also a counterfactual. In effect, you are asking whether TN would have grown faster if it did not have reservations.

    To isolate the effect of reservations on progress, there are two options available. One, set up an econometric model, estimate its parameters, and then simulate the model to find out what would have happened in the absence of reservations. Alternatively, you can find another comparable area which did not have reservations and then compare the performance of the two areas. You were following the second alternative. The validity of this exercise depends on whether the two areas are comparable. The fact that the South is doing no worse than other parts of India currently is a valid argument only if the part of India with reservations (the South, mostly) was comparable to some other part of India (without reservations) at the onset of the reservation policy. Essentially, I was asking whether that indeed was the case.

    Since, for the most part, social sciences lack the ability to do controlled experiments, the above two options - one may call the first one "simulation" and the second one "comparison" - are the only ways available. Note that both methods are essentially doing the job that "controlled experiments" do but in an imperfect way. That's unfortunate but that is the nature of social sciences.

    Suresh.

  16. Anonymous said...

    Dear Abi
    ...this post is really about your extraordinary assertion -- unsubstantiated so far -- that quotas harm progress, and quota candidates need not be competitive (because there aren't incentives for them to excel). All I have done here is to point out public sector successes that contradict your assertion. I used the private sector failures for disproving the related assertion that private -- quota-free -- sector is all fantabulous.

    And how does pointing out a handful of successful PSUs prove or disprove anything about the effect of quotas? Ditto for failed private sector companies? Do they even constitute a representative sample if we wanted to study the effect of reservation quotas?

    My point just boils down to this: do you or don't you agree that different cut-offs influence the amount of effort people put in, at the margin?

  17. Wavefunction said...

    Reservations are like computer modeling in drug design. They cannot be singled out as the only cause, but they always contribute to varying extents.

  18. Anonymous said...

    Nitin,

    I fully agree that there are 100 students in that one percent.... THat is not the issue. I was just telling that your claim that a candidate from reserved category need not strive hard is totally baseless. Hope you got the point

    Similarly, since promotions are not linked with performance for ALL COMMUNITIES, your claim that quotas alone are the cause of problem in government again is totally baseless

    Hope you understand this also

  19. Anonymous said...

    //They cannot be singled out as the only cause, but they always contribute to varying extents. //

    Excellent.... Our contention is that they contribute to the growth of the soceity..

  20. Abi said...

    Nitin: When you make an assertion, it is enough for me to cite one counterexample to 'disprove' that assertion. I have cited several, and it's clear you don't want to budge from your stand!

    You wrote, "do you or don't you agree that different cut-offs influence the amount of effort people put in, at the margin?"

    Where does one draw the margin, Nitin? At the top colleges? Or at the 'marginal' colleges? For the latter, there is no effort needed for anyone, including the general category students! They just need to meet the minimum criterion which seems to keep getting lowered every year, because of all those 'empty seats' in hundreds of colleges in the south.

    As for top colleges, the figures Bruno and I have cited here (and Reality Check has cited on his blog) indicate that the competition is intense for *everyone*. To insinuate that reserved category students would reduce their effort is just not correct. The large number of RC students who made it through the general category are a great example of their competitiveness!

  21. Anonymous said...

    There is NO proof to say that Quotas harm progress

    But there are enough proof (if not 100% valid and reliable proof) to say that Quotas help in progress

    If not, how can you explain for the competition across ALL Communities that is seen in Tamil Nadu.

    A good example is the NUMBER OF PEOPLE FROM RESERVED CATEGORIES GETTING SELECTED in the Open Category in Tamil Nadu.

    This is what we call as progress....

    And Nitin, you have not explained your stupid statement that PSU were failing because SCs get promoted irrespective of performance.... The reality is that EVERY ONE in a PSU (and that means the majority of forward community guys including) get promotion without consideration of performance..

    In such a scenario your statement attributing quotas to the problems of PSC is baseless, utterly foolish and also makes me wonder as to whether you can stoop to such levels for just criticising reservations..... If so, doesn't that tell that you don't have any valid points :) :) :) :) :)

  22. Wavefunction said...

    This has nothing to do with the topic at hand, but disproving an assertion in social sciences is not the same as disproving it in mathematics. If I make a general assertion that "Nazis were evil", there will be more than one counterexample, but the citing of those will not affect the general validity of the assertion.