Well-known stories play a much bigger role in making economic decisions than financial analysts and policymakers agree. If, of course, these stories are based on myth rather than reality, the consequences of such policies can be devastating. The showcasing precious metals in India in 2016 and the old story of a policy based on misconceptions. Surprisingly, a failure of the process it does not seem to be distorting the story and, as a result, there is a small price to pay for its failure.

Over time, energy

Narrative narratives are often based on social beliefs. Thus, the Great Depression of the 1930’s began to coincide with the escalation of the “twenty years” of oppression, although many financial reasons were responsible. The Weimar hyperinflation of 1921-24 is deeply embedded in German intelligence, so that even now, almost 100 years after the event, the German people view economic stability and distrust of government debt. Fiscal conservatism is still a major issue and has hampered recovery since 2008 in Europe. Although the recent epidemic of coronavirus has caused Keynesian treatment with steroids in many countries, there is already an economic outcry that is fueling rising prices.

Indeed, economic news, as well as other social sciences, creates myths that persist despite appealing to the real world. The issue of demonism in India was also based on well-known myths, black money legends and its affiliation with materialism. The idea of ​​getting rid of big money as a tool to get rid of big money that he did not mention was not new. This happened twice, in 1946 and 1978, with disastrous results. But, in contrast to the limited results of previous events, the 2016 show caused a major economic downturn, the cost of which should be accounted for.

Five years later, many observers saw the process as a failure. His few announced plans – to eliminate black money, bribery, move to “less money and digital assets”, or increase taxes – were achieved. Expectations of bwino 2 trillion-3 trillion in revenue were not met when 99.3% of the derecognised documents returned to the bank. If black money were available as illegal barns, it is likely that they were all thoroughly washed away. If the goal was to register a permanent change in the tax system, it failed miserably. Perhaps the clearest evidence of this failure is that financial management has now surpassed the pre-demonetisation stage.

Touch chord

And, after COVID-19, financial dependence is on the rise, as well as with many religious publications in circulation. Either way, performing demonstrations as a financial plan was a major failure. But, as a story, it was told and received in a completely different way. Despite its obvious shortcomings, the strength of the story was that it did well to make a positive or positive impression on the process.

The stories of black money and the vivid images that accompany them are easily recognizable and understood by ordinary people, who see corruption in everyday life and see it played out in movies, newspaper articles, or daily conversations for years. The same word, black coin, is a full word, while the color acquires a symbolic and clear form. The treasure, which represents fraudulent acquisitions, is generally considered to be stored in coins and gold coins, stored in safes, boxes, or secretly hidden cabinets.

The idea of ​​a miraculous reaction to the powerful impact of this economy is very appealing to the mind. It’s epics stuff. The dangers of black money have been frequently used in Indian politics, sometimes honestly and sarcastically. The issue of black money almost always has a positive connotation.

No matter, as he repeatedly emphasizes in a number of economics studies, there is no distinction between black and white money, except in the general sense. Although the proceeds of corruption or criminal activity are black money, most black money is obtained through legal proceedings even though it has not been disclosed to the tax authorities. Most importantly, black money is not saved for money except for a small amount but is collected through home and other goods. However, the way the article was written made it difficult for critics to express their criticism. Direct criticism would indicate that he was interested in protecting black money and corruption.

When it became clear that the banned money was being returned to more banks than expected, the issue changed the mindset from black money and counterfeit money to digital / cashless payments, the latter being promoted to a higher level than it is, the only technical change.

Sub-headings connected

A key element in selling the story was to establish sub-themes to promote the main story and, in some cases, to hide the facts on the ground. Identifying the virtues was very important: nationalism and patriotism are always useful, while technology and innovation are defined as a way to advance professional skills.

The call to sacrifice is of great interest in India, as elsewhere. The practice (showing demons) was the act of sacrificing together. People in long lines were reminded of the devotion of the soldiers who guarded the country’s borders and who did not think of their plight. Of course, it was satisfying to be told that the rich had a problem. In reality, the demand for the sacrifice was twisted in his own way, and the suffering of the poor was even more intense.

The real wonder lies in the fact that the moral principles expressed by the demonic stories worked better than in the case of actual anti-realities. It worked because they understood how the poor had a good attitude. For the poor, who have been around for a long time welcoming the government and its representatives, the demonic effects can be another blow in the struggles they had to deal with. Even so, it may seem fair to the rich if they really suffer.

Although there is ample evidence to the contrary, five years after the incident, the Government does not acknowledge any wrongdoing, nor does it have any doubts. However, it is clear that there has not been much talk about success.

Sudden onset

Many of the studies, opinion polls, media reports and irrefutable evidence have shown strong support for the theory. Despite personal problems, long lines, and loss of income and savings, there was a degree of misunderstanding in the criticism of the decision. Many tended to distinguish between the purpose and the real. That the point was a good one but probably not well used seemed to be a major theme. This perfectly protected the original sin – that the very process confirmed its consequences.

The story of the demons shows that well-known stories can explain the realities of economics.

Clearly, the more successful the news, the less politically motivated it will be. An unsuccessful failure plan can lead to many such plans. In contrast to many economic hardships, which can be traced back to what happened or unusual, demonic activity was spontaneous, which may have resulted from a sincere belief in the matter as they read politics.

Kaushik Jayaram is a former senior banker who has worked for many years in the World Bank