In this book, Gurcharan Das whines about life in India under the "License Raj". For many decades, India's government was over-regulated. The government was in charge of everything. Bureaucrats had great power--but not enough time or enthusiasm to carry out their duties. So anyone who wanted to run a business neeed licenses, and would probably spend about two years (a) figuring out who they needed to bribe, (b) bribing them, and (c) figuring out who they needed to bribe next. Corruption reigned. If you succeeded in business, your taxes were likely to be around 97% and could go over 100%. Perhaps this tax rate was fair punishment--you were probably a criminal if you'd made this much money, considering how many people you'd probably bribed. This state of affairs did not turn out well. In recent years, many of the regulations have gone away. Many new small businesses have sprung up. Mr. Das says this is pretty significant, and makes a good case.
Labels: book, entrepeneurship, graft