Thinking backwards: Rajan index will distort states' incentives

During the course of his maiden speech as RBI governor, Raghuram Rajan mentioned that he was not seeking Facebook "likes". He actually received quite a few. The RBI's mid-term policy review on September 20 must have given his admirers much heartburn and possibly earned him some "dislikes". The spotlight has turned on him again, with the release of the Rajan committee report on evolving a composite development index of states.

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