The Political Economy of Inequality and Capitalism in India

• AJAY KUMAR MISHRA

  Lalit Narayan Mithila University

• SHRADDHA RISHI

  Magadh University

  https://orcid.org/0000-0002-7544-3637 (unauthenticated)

The paper aims to critically examine inequality in India by analysing its philosophical, ideological, and political–economic foundations. This article's argument is that, while market forces influence the level of inequality in capitalism, such factors are also influenced by governmental policies and actions. Thomas Piketty has well observed in Capital and Ideology that Inequality is neither economic nor technological but ideological and political. The idea of privatisation of assets creates an artificial scarcity of resources that contributes to inflated rent. To contextualise inequality and capitalism in India, a discourse of social determinism is used that synthesises methods and insights from political science, economics, and sociology. Furthermore, capitalism automatically credits the declining profit share to wages rather than rent, according to Ricardian theory. In a nation like India, where labour is plentiful at fixed or stagnant wages, the use of Ricardian analysis is pertinent. It aids in examining rent capitalism's innate propensity to maintain inequality. The salient findings of the study are that the political economy in capitalism is trapped in the philosophical justification of inequality; the scarcity-induced rent on public assets causes remuneration differential to factors of production, and the role of political economy in maintaining the scarcity in capitalism.

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