Demonetisation roll-out deeply flawed, introduction of Rs 2000 notes puzzling: Richard Thaler, Nobel Laureate

The speculation over Nobel Laureate, Richard Thaler’s views on demonetisation has finally been laid to rest. Ever since the winner of the 2017 Nobel Prize in Economics was announced, BJP leaders and supporters led by the head of their IT cell have used Thaler’s single tweet out of a conversation as evidence of his support for demonetisation. In a rally in Amethi last month, UP Chief Minister, Yogi Adityanath also joined the bandwagon and declared that “The Nobel Prize for Economics was awarded to the economist who was the first one to welcome demonetisation.” Against this backdrop, Thaler has finally clarified his view on India’s demonetisation in no uncertain terms in an email.

Instead of speculating about one cherrypicked tweet, how about asking Professor Thaler directly about his views on demonetisation? This is exactly what a Twitter user, Swaraj Kumar did. He emailed Thaler with the following question:

“After the announcement of Nobel committee, your tweet on India’s demonetization got a lot of attention and many people are quoting it to support the whole exercise.I know that you have suggested in the past to demonetize higher denomination to reduce corruption and to move towards a cashless society. But I was wondering what’s your thoughts on the execution like demonetizing 86% of the notes in circulation and only 50 days for the note exchange?”

Professor Thaler didn’t mince his words in his response. He replied, “The concept was good as a move to a cashless society to impede corruption but the rollout was deeply flawed and the introduction of the Rs 2000 note makes the motivation for the entire exercise puzzling.”

And to make sure there was no scope for any doubt about his response, he also tweeted it from his official Twitter account. You can see in the screenshot below his response when Kumar confirmed with him, “Can I quote your response publicly so that people stop using your initial support of Demonetisation to justify the whole exercise?”

Rupa Subramanya brought the email exchange to the attention of twitter users tagging Thaler who retweeted her tweet.

Desperate for positive endorsement of the demonetisation exercise, BJP IT cell had been circulating this 2016 tweet of Thaler in which he sees demonetisation as a first step towards going cashless and reducing corruption. That was before he learnt about the introduction of a Rs. 2000 note.

“Really? Damn.” was his reaction when he was told about the Rs. 2000 note in the place of the discontinued Rs. 500 and Rs. 1000 notes. Introduction of the Rs. 2000 note, negated the objectives of going cashless and reducing corruption which he supported. This part of Thaler’s response was conveniently not disclosed by BJP IT cell while sharing Thaler’s tweet.

Even after it was repeatedly pointed out to Malviya that his tweet about the Thaler’s support of demonetisation is incorrect, he refused to delete it. The same was retweeted by many including BJP leaders and made it to WhatsApp groups and popular right wing websites like The Frustrated Indian. Thaler’s support is now even brought up in election rallies as we saw above in the case of Adityanath in Amethi.

Those clutching at the straws even after Thaler’s “Really? Damn” tweet will now be convinced that he does not support the demonetisation exercise. His message is clear. Even though he sees demonetisation as a good concept to move to cashless society and curb corruption, he believes that the roll out of India’s demonetisation was deeply flawed. He also questions the logic behind the introduction of Rs. 2000 note. And he is saying all this so people stop using his name to justify the exercise. Demonetisation cheerleaders, are you listening?