Thursday, March 11, 2010

The two great industries of Bombay

A few years ago, when Percy Mistry's committee was working on the MIFC report, I used to joke that of the two great industries in Bombay, movies will make it first to international customers. A few days ago in the New York Times, Anupama Chopra has a story showing that some action on that front is now visible.

Winning on a global scale in finance and in movies has some common features : it involves raw materials like human capital, top end computer technology, freedom of speech, openness to other cultures, a large home market, the natural opportunities of connecting up with the disapora, and Schumpeterian creative destruction.

With all these in place, Bombay's movie industry is nicely globalising itself. Finance requires all these - and that bodes well for BIFC. But finance requires a few more things. It requires sophisticated financial regulation, and a sound macroeconomic policy framework. It requires that the government get out of producing financial services just as the government does not produce movies. India has a tonne of work to do on these.

3 comments:

  1. I have read arguments like the below one. In fact you have also written time and again on these issue. But what is the alternative methods to go about?

    " It requires that the government get out of producing financial services just as the government does not produce movies. India has a tonne of work to do on these."

    I have also read works of Prof F A Hayek. There is no doubt there is clear cut difference between your way of putting argument and the Prof Hayek's on the role of government and the financial system.

    How would you relate your works with that of Prof Hayek's on the above issue?

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  2. i really like that blog as that gives info about Bombay movies industry is going global attraction in terms financial investment.

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  3. i really appreciate that Indian movie industry getting global attention.

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