Abstract

Metrics like house price to income ratio, and price to rent ratio are useful. But for valuation we need to consider the ratio of market price to fundamental value. In India, this ratio is high for land. But unlike the case of the stock market, this ratio is not a good indicator of a bubble in the real estate market. High price of land in India is mainly due to a broadly defined variant of the license-permit-quota (LPQ) Raj in real estate development in urban India, and the pricing provision in the Land Acquisition Act, 2013 in rural India. A corollary is that factors like scarcity of land, population size, black money, urbanisation, and nuclear families are not very important here. The main policy solution is to phase out such LPQ Raj in urban India. This can, in turn, pave the way for amendment of the pricing provision in the Land Acquisition Act.

Speaker

Gurbachan Singh

Gurbachan Singh is an independent economist. He was previously visiting professor at Ashoka University. He has taught at Indian Statistical Institute (ISI), Delhi Centre, Jawaharlal Nehru University, and University of Delhi. His writings are primarily on the interface between macroeconomics and finance. The work is mainly in theory to explain the real world and to devise better economic policies. He received his PhD from ISI (Delhi Centre), and MA from Delhi School of Economics. Besides publications in academic journals, he has contributed substantially to Ideas for India, and Business Standard. He published a book on Banking Crisis, Liquidity, and Credit Lines with Routledge, Abingdon. His new book on Macroeconomics and Asset Prices - Thinking Afresh on Basic Principles and Policy is nearly complete. This includes a new interest rate policy that is BEST - Better-targeted, Effective, Small-sized and Transparent compared to the prevailing interest rate policy.

Chair

Sunil Mitra Kumar

Sunil Mitra Kumar is a senior lecturer in economics at King's College London. His research focuses on questions related to inequality and discrimination, particularly in the context of development. He serves as an Associate Editor for the Journal of Development Studies and Economia Politica, and he is currently leading an ESRC-funded project on the role of small firms in UK-India trade. Sunil received his PhD in Economics from the University of East Anglia, his MA in Economics from the Delhi School of Economics, and his BA (Hons) in Mathematics from St. Stephen’s College, Delhi University. During 2005-2008 he worked for the Social Initiatives Group of ICICI Bank, an erstwhile major funder of non-profit activities in India.

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