Articles by R K Pattnaik

Design thinking as a subject has grown enormously in theoretical content over the past 50 years. However, both design thinkers and policymakers have not come closer to developing design thinking in policymaking. Recognising this research gap, a prototype called the basic resource gap model has been designed as a supplement to the extant fiscal rule, with fiscal deficit as its target. The study highlights both the potential applicability of the design-thinking approach to the process and specifies an application that can supplement the extant fiscal rule and potentially enhance fiscal management.

An assessment of the inflation record of India reveals that inflation increased from the 1970s onwards before moderating in the mid-1990s. Supply shocks, both due to a setback in agricultural production and international oil prices, and monetary expansion due to automatic monetisation of the fiscal deficit were the major contributory factors to higher inflation. Reform initiatives since the early 1990s towards developing a broad-based financial market, particularly activation of the government securities and forex markets coupled with improved monetary-fiscal interface enabled better monetary management since the second half of the 1990s. Moreover, judicious supply management through buffer stocks of foodgrains and import of sensitive commodities containing the adverse impact of supply shocks also played an important role. It can also be noted that notwithstanding the unprecedented size of external capital flows, monetary management was effective in ensuring a reduction in inflation and lowering expectations.