“Time to Revisit Notions of Efficiency”

In the fourth lecture in the series, ‘Inequality Conversations’, hosted by the Centre for Public Policy at IIM Bangalore, on March 14th, Dr. Deepak Malghan, from the Public Policy area, traces the historical relationship between Inequality and Efficiency and says algorithm has replaced engine as the metaphor for efficiency.

In his lecture on ‘Inequality and Efficiency: A Three-Hundred Year Potted History’, Prof. Malghan pointed out that there is no idea in all economic theory and praxis that is more important than efficiency. “Despite, or perhaps because of its centrality and ubiquity, efficiency’s intellectual provenance has largely escaped scholarly attention,” he observed, providing a historical framing of inequality.

“While there are fine histories of the science of thermodynamics and how it evolved jointly with economic thought, the intellectual trajectory of efficiency from steam engines to economics and beyond is not well charted. My talk will show how these connected histories are central to understanding modern economic inequality. These histories also shed new light on quintessential policy conundrums such as Arthur M Okun’s ‘big trade-off’ between equality and efficiency. The time is quite right to revisit Okun,” he said.