The road from serfdom: economic storytelling and narratives of India in the rise of neoliberalism

Abstract

Studies of neoliberalism’s rise in the second half of the twentieth century have focused on influential US and European thinkers and global economic institutions. They rarely mention India. This article argues that, in the 1950s and early 1960s, Nehru’s India served as both a central laboratory and a discursive field for international economists debating the proper role of the state in economic development. US economists like John Kenneth Galbraith held up India planning as a proxy for the ‘American way’ of capitalism in Asia; neoliberal economists like Milton Friedman and B.R. Shenoy excoriated Nehru’s ‘road to socialism.’ As India’s economy stumbled in the late 1960s, neoliberal economists used Indian foundations to build an empirical and rhetorical case against scientific planning. Their cautionary tales about India’s ‘Permit-License-Raj’ helped to construct and sustain the project of delegitimizing state action and celebrating markets.