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6) Comment on the role of behavioural economics in India to bring social change and achieve the policy objectives of welfare programmes with suitable illustrations.(250 words)

Topic: Attitude: content, structure, function; its influence and relation with thought and behaviour; moral and political attitudes; social influence and persuasion.

6) Comment on the role of behavioural economics in India to bring social change and achieve the policy objectives of welfare programmes with suitable illustrations.(250 words)

Insightsonindia

Why this question:

The Economic Survey 2019 has drawn on Nobel Laureate Richard Thaler’s Behavioural Economics Theory to lay out what it describes as an “ambitious agenda” for behaviour change that will bring in social change, which in turn, will help India transit to a $5 trillion economy by 2024-25. Programmes such as Swachh Bharat Mission, Jan Dhan Yojana and Beti Bachao Beti Padhao, provide testimony to the potential for behavioural change in India. 

Key demand of the question:

One must explain the role of behavioural economics in India to bring social change and in what way recent policies and initiatives have followed the model to address various issues in the country.

Directive:

Commenthere we have to express our knowledge and understanding of the issue and form an overall opinion thereupon.

Structure of the answer:

Introduction: 

In brief define what behavioral change is.

Body:

Explain the following aspects in detail – 

  • What is Behavioural Economics?

  • What are the learnings of the economic survey on Behavioral Economics?

  • How Behavioural Economics can be applied in the Indian context?

  • What are the limitations of Behavioural Economics?

Conclusion:

Conclude that the government regulation, taxes and free-market policies should be clubbed with a nudge effect to increase the efficacy of policymaking. If it is implemented diligently than Indian policymaking will be transformed.

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