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01 / 05
India’s Good Fortune: How the Country Is Tackling Energy Poverty, Increasing Growth, and Building the Future

Blog Post | Economic Growth

India’s Good Fortune: How the Country Is Tackling Energy Poverty, Increasing Growth, and Building the Future

Energy poverty and many other problems will soon be things of the past for India.

Summary: Over the past two decades, India has made remarkable strides in multidimensional poverty reduction. This comprehensive measure, which considers factors like education and infrastructure alongside income, paints a more accurate picture of poverty. Additionally, India has achieved significant progress in areas such as child mortality, sanitation, access to clean water, and electricity, signaling a positive trajectory for improved living standards and environmental outcomes in the country.


Just two decades ago, life in India looked bleak. Between 2005 and 2006, 55.1 percent of the Indian population—the equivalent of 645 million people—suffered from multidimensional poverty, and in 2004, 39.9 percent of Indians lived in extreme poverty.

Multidimensional poverty measures the percentage of households in a country deprived along three factors: monetary poverty, access to education, and basic infrastructure services. That captures a more thorough picture of poverty.

Multidimensional poverty dropped from over half of the population to 27.7 percent (370 million people) in 2014. In 2019–21, the proportion of people suffering from multidimensional poverty declined further to only 16.4 percent of the total population, or 230 million people. Although the pandemic slowed some aspects of poverty alleviation, the percentage of people in multidimensional poverty has continued to drop significantly year on year in India.

It’s also worth considering extreme poverty, which is defined as living below the international poverty line of $2.15 per day. Using this measure, the number of people living in extreme poverty in India declined from more than half of the population (63.1 percent) in 1977 to only 10 percent in 2019.

Moreover, child mortality declined from 43.4 percent in 1918 to only 3.1 percent in 2021. The number of people without adequate sanitation has dropped from 50.4 percent to 11.3 percent, and the proportion of people without adequate drinking water has fallen from 16.4 percent to just 2.7 percent. As well, more people in the country have access to clean cooking fuels than ever before, from 22.3 percent of people in 2000 to 67.9 percent in 2020.

India has also been tackling environmental concerns. The population of the greater one-horned rhino, which has a “vulnerable” conservation status, has increased from 40 in 1966 to over 4,000 in 2021. Air pollution is one of the world’s largest health and environmental problems, and in low-income countries, it is often the leading risk factor for death. Although there is still work to do, the death rate in India from air pollution decreased from 1990 to 2019 by 42 percent, from 280.5 deaths per 100,000 people to 164.1 deaths per 100,000.

In 2017, Indian Prime Minister Modi launched a plan to electrify more households, targeting over 40 million families in rural and urban India, or roughly a quarter of the population. The plan was called “Saubhagya”—literally, “good fortune” or “auspiciousness.” Although the country did not meet its target as quickly as planned, access to electricity in India has been increasing.

The term “access to electricity” does not have a universally accepted definition, but general usage takes into account the availability of electricity, safe cooking facilities, and a minimum level of consumption. According to the International Energy Agency, “access to electricity” involves more than just connecting a household to the grid; it also requires households to consume a certain minimum amount of electricity, which varies based on whether it is a rural or urban household.

According to the UNDP report, 97.9 percent of Indians had access to electricity between 2019 and 2021. Only 50.9 percent of Indians had access to electricity in 1993. The country has achieved immense progress. In 2018, Prime Minister Modi stated that every village in India had access to electricity.

Climate change is likely to be costly to the Indian subcontinent. Heatwaves have already led to an increase in deaths in India, particularly since a large share of the population is employed in outdoor labor like farming and construction.

India aims to reach net-zero emissions by 2070 and for 50 percent of the power-generation capacity to come from clean energy sources by 2030. The energy transition for India will take time, and the country will need fossil fuels to meet its energy needs for many years yet, but the future is looking promising.

Last year, for example, India brought an indigenous reactor design online at the Kakrapar Atomic Power Project Unit 4. India has 22 working nuclear reactors, which produce about 3 percent of the country’s electricity. India has ambitious plans to build more reactors—aiming to commission a new reactor every year.

The fact that a large country can more than halve multidimensional poverty in only 15 years is a cause for celebration, but India’s foresight of meeting future increasing energy needs is also something to be applauded. Energy poverty will soon be a thing of the past for India. Increased electricity will lead to further poverty alleviation, economic growth, and improved living standards, which in turn will lead to better air quality and environmental outcomes. These are good fortunes that we can all celebrate.

Blog Post | Economic Freedom

The False History of American Capitalism | Podcast Highlights

Economist Donald Boudreaux joins Marian Tupy to discuss important misconceptions about American economic history and why it’s crucial to set the record straight.

Listen to the podcast or read the full transcript here.

Today, I have with me Don Boudreaux, a professor of economics at George Mason University. He has a new book out, co-authored with the former senator from Texas, Phil Gramm, called The Triumph of Economic Freedom: Debunking the Seven Great Myths of American Capitalism. It’s a fantastic read, full of information and killer arguments.

We’re going to discuss that book today. But first, Don, why is the study of economic history important?

What we think we know about the past determines how we assess the present.

For example, if we think that in the past, a certain monetary policy did this or did that, that’s going to affect how we think monetary policy should be conducted today. So, in order to make good decisions in the present, we have to do our best to understand how various policies worked out in the past. That’s what we try to do in the book.

Let’s jump in and tackle trusts, or as we call them today, monopolies. We often hear about the power of monopolies in today’s America, but let’s go back to the 19th century. What was the trust problem, and what was the solution meant to address?

Some of the first original research I did as a young scholar was looking into the Sherman Antitrust Act of 1890. I had a colleague, Tom DiLorenzo, who, in 1985, published a wonderful paper on the origins of the Sherman Act, 95 years after its enactment. Astonishingly, no one in that near century-long period had ever bothered to check what had actually happened to the prices and outputs of the industries that were supposedly monopolized. So, Tom looked at these data and adjusted them for deflation—there was a deflationary period from the end of the Civil War until the early 20th century—and found that in the decade leading up to the Sherman Antitrust Act, the prices of the outputs of these allegedly monopolized industries fell faster than prices in the economy as a whole. Likewise, the outputs of these industries rose faster, and in most cases, multiple times faster than the output of the overall economy.

This is inconsistent with the monopoly story. Monopolies are supposed to raise prices, not cut prices. In reality, there was no monopoly problem in the 1880s; there was a competition problem. We had, for the first time, a fully transcontinental economy, thanks to the railroads and the telegraph, and soon thereafter, the telephone. So, a lot of firms could now take advantage of economies of scale. John D. Rockefeller in petroleum refining, Gustavus Swift in meat slaughtering, James Buchanan in tobacco manufacturing, and so on. And these firms did grow large, but “large” is not an appropriate definition of a monopoly. A monopoly is a firm that can suppress competition, raise prices, and suppress output. These firms did the opposite. They grew big, but they grew big precisely by being so efficient that they could lower their prices and expand their output.

Now, whenever this happens, other producers complain. And in the 19th century, the complaints came disproportionately from local butchers and local cattle raisers. Before the railroad and refrigeration, slaughtering took place locally. So, when the first meat packers set up shop in Chicago and began centrally slaughtering livestock and shipping the meat out across the nation by refrigerated railroad car, they destroyed an age-old line of work. These local butchers and independent cattlemen raised hell, and local politicians listened to them, villainized these firms, and attacked them with antitrust statutes.

Frankly, these early antitrust statutes, and the subsequent ones, were not intended to address what was truly perceived as a problem of monopoly. They were aimed at placating disgruntled producers who had been outcompeted by larger, more efficient, and more entrepreneurial rivals.

You mentioned the D word, “destruction.” The destruction of local butchers by big, centralized butchers. Is that a good thing?

Well, economic growth requires that resources move from where they are less productive to where they are more productive, so change is inevitable if you want economic growth.

Some people might naively say, “Well, look, we’ve had enough growth, let’s just stop now,” and try to freeze everything in place. Now, I’m sure almost everyone alive today is very happy that our ancestors did not settle for the level of economic activity that existed when they were alive. You and I would not be talking over Zoom, and web designers would have eight legs.

However, even if we all agreed to settle for our current level of prosperity, we would still need to allow economic change, because some things are beyond human control. Supplies of raw materials can dry up. Natural disasters can destroy factories. So, we always need people to be able to adjust to the facts on the ground. That flexibility, that entrepreneurial alertness and creativity, is inseparable from capitalism. If you try to freeze our economy in its current pattern, you’ll collapse it. We can either continue to move forward and embrace creative destruction, or we can collapse into destitution.

Yeah, that’s fundamental. There are, in Donald Rumsfeld’s famous words, “unknown unknowns,” and we want to be as rich and as technologically sophisticated as possible when those challenges arise.

Okay, on to the big one, the granddaddy of them all, the Great Depression. Can you steelman the anti-market position about what happened in 1929? What went wrong?

Yes. In the 1920s, a fundamental contradiction of capitalism reached its peak. The rich were getting richer relative to the poor, and rich people spend a smaller portion of their incomes than poorer people. By the late 1920s, you had an increasingly unequal distribution of income, and a smaller portion of that income was being spent. As a result, America’s factories were producing more than America’s factories could sell, and a terrible spiral took place. The factories started laying off workers, which further reduced the income of factory workers, who responded by reducing their spending, which further reduced economic output and employment.

All of this happened when Herbert Hoover was president. And as everyone knows, Hoover was a staunch advocate of laissez-faire. He was a do-nothing president. The Depression happened, and Herbert Hoover just sat in the White House and twiddled his thumbs, hoping this recession would go away. Then, of course, it got worse. By 1932 and 1933, unemployment in America hit 25 percent. Fortunately, the American people elected Franklin Roosevelt, who came to office with a whole bunch of really good ideas and smart advisors. They developed the New Deal, a system of relief programs, and we were able to start recovering. Finally, World War II comes along, there’s more government spending, and we get out of the Depression. That’s the myth.

That’s what a lot of American kids learn at school. But I suspect that you don’t quite agree with that interpretation of the Great Depression.

No, I don’t. Let’s start with the easy one: Hoover was not a do-nothing president or an advocate of laissez-faire. Hoover was the president who signed the Smoot-Hawley Tariff Act. He created the Reconstruction Finance Corporation. Hoover spent at a deficit during every year of his administration. In fact, one of Franklin Roosevelt’s campaign platforms was that Hoover was too big a spender. Hoover’s administration was the first time, really, that any sitting American president did much to combat an economic downturn. So that’s a complete fallacy.

There are other problems too. In the 1920s—and this is from research done by Simon Kuznets, a Nobel Prize-winning, very respectable economist—the distribution of income did not grow more heavily toward upper-income Americans. In fact, it became a little bit flatter in the 1920s. In terms of spending, the mythical theory says that there just wasn’t enough spending to buy what the factories were producing. But if you look at the data on consumer spending in the 1920s, it was off the charts. It was a boom time for Americans.

What actually happened, and here I’m quite conventional, was bad monetary policy. The Fed was created in 1913 to serve as a lender of last resort. Before the Fed was created, whenever banking crises would happen, they had private arrangements where bank clearing houses would get together and channel liquidity to the parts of the banking system that needed money. And these panics, as they were called, were quickly undone. But after the panic of 1907, people said, “Well, we can’t have this. Let’s get the government to take over this process.” And they created the Federal Reserve.

When the downturn began in August of 1929, the Fed should have stepped in to prevent the money supply from contracting. But the Fed just stood by, and from 1929 to 1933, the money supply contracted by over 30 percent. That is huge. Then, on top of that, you have the hyperactive Hoover, who administered a historically unique level of economic intervention. And then it gets worse under FDR.

The big problem was what the economic historian Bob Higgs calls regime uncertainty. Hoover and Roosevelt became increasingly hostile to businesses and investors throughout the 1930s. Basically, they scared investors off. Well, if you want economic recovery, you can’t scare investors off. You can’t threaten their property rights. You can’t threaten to tax away their earnings. You can’t threaten to control prices. All of this was being done. Roosevelt became a little more friendly to businesses when he needed them to cooperate in the war effort, but there was still concern that after the war, Roosevelt would return to his increasingly anti-capitalist stance. But of course, Roosevelt died in April of 1945, and Truman, for all of his imperfections, was a businessman, and he was perceived, quite rightly, as much less radical than Roosevelt.

Higgs dates the end of the Great Depression as immediately after the war, 1946 or 1947. The war years, we can’t say much about. You’re conscripting people into a military, so unemployment looks low, but that’s not the result of an improved market economy. Prices are controlled. Wages are controlled. Certainly, the standard of living of ordinary Americans back home was falling. So, if you define the end of the Depression as a return to high and rising living standards for ordinary people, you don’t get any evidence of that until the years immediately following the end of World War II. So, the New Deal didn’t cure the Great Depression. If anything, it extended the Great Depression throughout the 1930s. If we’re going to actually rely on data, we must say that the Depression only ended after the end of World War II.

Now on to the final topic, the Great Recession.

The mainstream explanation is that financial deregulation created the housing crisis. Greedy, mustache-twisting bankers lent money to people who they knew couldn’t repay the mortgage loans, which anybody with common sense would know is not a good banking strategy.

In fact, what happened is that starting in the early 1990s, the government became intent on increasing the rate of home ownership. So, the government wanted banks to extend mortgage lending to people that they otherwise wouldn’t lend to, but the banks didn’t want to lend money to people who were unlikely to pay them back. So, the federal government said, look, Fannie and Freddie, increasingly large shares of your portfolio have to be made up of subprime mortgages, or we’re going to do all kinds of nasty things to you.

Say you’re a bank in Omaha, Nebraska, and someone comes to you to borrow money to buy a house. In the past, you’d say, “Sorry, you don’t have 20 percent to put down, and you don’t have a high enough income. I’m not going to lend you the money.” But now, Freddie comes by and says, “I really want to buy some subprime loans from you, so if you make some subprime loans, I’ll buy them from you and relieve you of the risk.” So, when that same borrower comes back, you lend them the money and sell the mortgage to a government-backed firm. Now you’re off the hook, but that bad loan is still out there. The result was that increasingly large numbers of house mortgages were held by people who couldn’t afford to repay them, and so any decline in economic activity, and certainly any decline in housing prices, would put a lot of the homeowners under water, and that is what eventually happened. The house of cards collapsed.

One final question: Why don’t bad ideas die?

There are at least two reasons.

First, if you show me a bad economic idea, I will show you a special interest group that benefits from it. This is what Bruce Yandle called the “Bootleggers and Baptists” idea: when you have a sincere but mistaken belief backed by venal interest groups who stand to gain materially by the maintenance of those beliefs, those beliefs become entrenched.

The second reason is that bad ideas are usually easier to grasp than good ideas. Good ideas tend to involve one or two steps of reasoning beyond the bad idea. And so, to push out bad ideas and replace them with good ideas requires good education. So, all the things that we’re doing, all the blogging and podcasting and tweeting.

It’s a struggle to present good ideas, but we have no choice. We have to keep doing it. And history shows that, if you’re effective at it, you can sometimes push bad ideas aside and replace them with good ideas. But it’s a never-ending battle. It’s not like the bad idea is defeated and then it goes away forever. It’ll always lurk. So, we always have to be at the ready to challenge it with good ideas. And we have to be very patient.

The New Times | Poverty Rates

Rwanda Sees Sharp Drop in “Multidimensional” Child Poverty

“According to a study by the National Institute of Statistics of Rwanda (NISR), multidimensional child poverty analysis for Rwanda encompasses five dimensions of wellbeing, namely health, education, water, sanitation and housing. These dimensions are further disaggregated by key backgrounds such as province, sex, household head’s education level and family composition.

A child is considered multidimensionally poor when they concurrently experience deprivation in at least three of the five dimensions of wellbeing.

According to the NISR’s latest multidimensional child poverty thematic report released on July 7, the rate of children aged 5 to 14 living in multidimensional poverty has more than halved from 25.3 per cent in 2016/17 to 11.9 per cent in 2023/24.”

From The New Times.

World Bank | Economic Growth

Developing Countries Have Seen Sustained Growth Since 1987

“Since the late 1980s, the classification of countries into income categories has transformed. The number of low-income countries has steadily declined, while the number of high-income countries has increased.

This shift reflects broader global economic developments, including sustained growth in many developing countries, greater integration into the global economy, and the effects of policy reforms and international organizations’ support. In 1987, 30% of reporting countries were classified as low-income and 25% as high-income countries. By 2024, these ratios shifted to 12% low-income and 40% high-income.”

From World Bank.

Blog Post | Population Growth

No, Prosperity Doesn’t Cause Population Collapse

Wealth doesn’t have to mean demographic decline.

Summary: For decades, experts assumed that rising prosperity inevitably led to falling birth rates, fueling concerns about population collapse in wealthy societies. But new data show that this link is weakening or even reversing, with many high-income countries now seeing higher fertility than some middle-income nations. As research reveals that wealth and fertility can rise together, policymakers have an opportunity to rethink outdated assumptions about tradeoffs between prosperity and demographic decline.


For years, it was treated as a demographic law: as countries grow wealthier, they have fewer children. Prosperity, it was believed, inevitably drove birth rates down. This assumption shaped countless forecasts about the future of the global population.

And in many wealthy countries, such as South Korea and Italy, very low fertility rates persist. But a growing body of research is challenging the idea that rising prosperity always suppresses fertility.

University of Pennsylvania economist Jesús Fernández-Villaverde recently observed that middle-income countries are now experiencing lower total fertility rates than many advanced economies ever have. His latest work shows that Thailand and Colombia each have fertility rates around 1.0 births per woman, which is even lower than rates in well-known low-fertility advanced economies such as Japan, Spain and Italy.

“My conjecture is that by 2060 or so, we might see rich economies as a group with higher [total fertility rates] than emerging economies,” Fernández-Villaverde predicts.

This changing relationship between prosperity and fertility is already apparent in Europe. For many years, wealthier European countries tended to have lower birth rates than poorer ones. That pattern weakened around 2017, and by 2021 it had flipped.

This change fits a broader historical pattern. Before the Industrial Revolution, wealthier families generally had more children. The idea that prosperity leads to smaller families is a modern development. Now, in many advanced economies, that trend is weakening or reversing. The way that prosperity influences fertility is changing yet again. Wealth and family size are no longer pulling in opposite directions.

This shift also calls into question long-standing assumptions about women’s income and fertility. For years, many economists thought that higher salaries discouraged women from having children by raising the opportunity cost of taking time off work. That no longer seems to hold in many countries.

In several high-income nations, rising female earnings are now associated with higher fertility. Studies in Italy and the Netherlands show that couples where both partners earn well are more likely to have children, while low-income couples are the least likely to do so. Similar findings have emerged from Sweden as well. In Norway, too, higher-earning women now tend to have more babies.

This trend is not limited to Europe. In the United States, richer families are also beginning to have more babies than poorer ones, reversing patterns observed in previous decades. A study of seven countries — including the United States, the United Kingdom, Germany and Australia — found that in every case, higher incomes for both men and women increased the chances of having a child.

This growing body of evidence challenges the assumption that prosperity causes people to have fewer children. 

Still, birth rates are falling across much of the world, with many countries now below replacement level. While this trend raises serious concerns, such as the risk of an aging and less innovative population and widening gaps in public pension solvency, it is heartening that it is not driven by prosperity itself. Wealth does not automatically lead to fewer children, and theories blaming consumerism or rising living standards no longer hold up.

Although the recent shift in the relationship between prosperity and fertility is welcome, it is not yet enough to raise fertility to the replacement rate of around 2.1 children per woman — a challenging threshold to reach.

But the growing number of policymakers around the world concerned about falling fertility can consider many simple, freedom-enhancing reforms that lower barriers to raising a family, including reforms to education, housing and childcare. Still, it’s important to challenge the common assumption that prosperity inevitably leads to lower birth rates: Wealth does not always mean fewer children.

This article was published at The Hill on 6/16/2025.