The Great Indian Tamasha

What I will argue for in this article is quite unorthodox and contrary to the conventional economic arguments that we are used to. I propose that in order to tide over the COVID 19 crisis and kick start the economy; the government should consider printing money and transferring the equivalent amount directly into the thirty crore Jan Dhan accounts. This will work to seamlessly ensure that the money reaches the masses while acting as a stimulant to revive demand. In economic terms, we call it monetizing the fiscal deficit that is a red herring in traditional economic logic, as most economists would rightly argue against printing money to finance deficits, citing inflation as a major concern.  The reason is that printing more money doesn’t increase economic output – it only increases the amount of cash circulating in the economy. If more money is printed, consumers are able to demand more goods, but if firms have still the same amount of goods, they will respond by putting up p...