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When India kicked out Coca-Cola, local sodas thrived (2019)

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Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#81

Post by rayiner »

> “When I chucked out Coca-Cola in 1977, I made the point that 90 percent of India’s villages did not have safe drinking water, whereas Coke had reached every village,” the late Fernandes said in a 1992 New York Times article, adding “Do we really need Coke? Do we need Pepsi?”

Between 1977, when India kicked Coke out the country, to 1993, 16 years, when Coke reentered the Indian market, India's GDP per capita (adjusted for inflation) increased 65%. During the next 16 years, from 1993 to 2009, GDP per capita increased increased 267% (multiplying by 3.6x). In the next 11 years, GDP per capita doubled again.

Had India not engaged in a multi-decade dalliance with central planning and pursued economic liberalization off the bat, India's per-capita GDP would be twice as high today.

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#82

Post by unishark »

intended wrote: post #29
mardifoufs wrote: post #12

Earlier quoted context omitted.

Latin america and even india are proofs that "pure" protectionism does not work. Even China is an example of free trade working. China opened up massively , reduced customs, reduced costs of doing business etc for 3 decades before moving towards more restrictive and more protectionist policies. After learning as much as possible from foreign corporations that flocked to China. Even now, free trade would be much more…

I think you’ve made an argument for free trade, but your examples and logic don’t refute the value of protectionism. China is a ridiculously protectionist state - people in the west had theorized that the market would force China to more opennness and democracy back in the day. China instead found a way to run a market with Chinese characteristics - a dual contract system where the English contract holds little power…

> China is a ridiculously protectionist state - people in the west had theorized that the market would force China to more opennness and democracy back in the day.

The Chinese government has almost completely lost control of its market. They can control (and profit massively from) very narrow things like blocking foreign servers on their internet (which happens to include our largest tech companies) but otherwise it is very much the wild west over there. The political system has chinese characteristics, but the wildfire of capitalism going in is just plain capitalism, and more so than in the US in some ways.

As for whether the government can survive, this is a complicated question but sooner or later an opposition group always defeats the rulers. I wound't write this ending off yet. Or ever, really.

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#83

Post by newyankee »

kevin_thibedeau wrote: post #78
missedthecue wrote: post #73

Earlier quoted context omitted.

"People like to pretend that protectionism is such a bad thing" David Ricardo mathematically proved it was a bad thing over 200 years ago. It absolutely befuddles me that people, especially in scientific communities, continue to support its implementation. Hong Kong has always been free trade and their GNP per capita is now greater than all of western europe, barring Norway (which is equal to HK). Protectionism makes…

> their GNP per capita is now greater than all of western europe What if Shenzhen didn't exist across the river? HK is part of a unique economic environment with significant externalities making it prosperous.

Approaches that make small countries like Singapore, Taiwan or Hongkong succesful are not easily scaled to a large one like India. Using them as examples in arguments is very disingenuous.

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#84

Post by newyankee »

econcon wrote: post #80
Mekantis wrote: post #2

People like to pretend that protectionism is such a bad thing. But Western nations built themselves through protectionism, it's something China has been doing to great success and the Asian tiger economies (primarily South Korea) did as well. After all, there's only so much you can do for your population if you never ensure a steady supply of high quality jobs that provide a path into the middle class, and you don't…

> it's something China has been doing to great success and the Asian tiger economies (primarily South Korea) did as well. When india imposed duties against chinese steel, the steel sector grew but soon the Real Estate sector accrued high input costs and real estate became expensive. Same happened to automobile sector in india, yes few people gain from protectionism at expense of others. I'd go on 1 foot and tell ever…

Indian real estate is expensive due to outdated town planning and land use laws. This is because the people who control most of the real estate (politicians) do not want increase in supply which depresses its price. Construction cost although important is a much lower part of the equation compared to land cost.

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#85

Post by newyankee »

econcon wrote: post #72
Mekantis wrote: post #2

People like to pretend that protectionism is such a bad thing. But Western nations built themselves through protectionism, it's something China has been doing to great success and the Asian tiger economies (primarily South Korea) did as well. After all, there's only so much you can do for your population if you never ensure a steady supply of high quality jobs that provide a path into the middle class, and you don't…

Like Indian comment producers were found colluding to keep the domestic cement price high. If there was competition from foreign players, this would have not happened

This is true. Transparent regulation and enforcement of rules is the only protection. Other examples is the sugar industry 'mafia' in the state of MH where private players cannot easily enter.

It is not like we do not have any checks and balances. We have an activist Supreme court as well as high courts which ignore average folks but open their doors at 3 am for special hearings for important folks.

However overzealous regulation in India has also meant that a Copper plant in India was closed in Tuticorin after protests allegedly funded by Chinese interests. Now India imports Copper from China. Apparently the main reason why protests happened (pollution) did not change 1 year after closure of the plant. Whereas thousands of poor unskilled laborers did lose their jobs.

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#86

Post by perl4ever »

newyankee wrote: post #7

When India liberalized in 1991 and welcomed foreign investment again rick Coke simply bought out a lot of local competitors. Even today my favorite local soda 'thums up' is marketed as a separate drink by Coke in India. A water scarce country like India should really not promote high consumption of soda and sugar based drinks. However the same cannot be said about other industries. Pre liberalization India used to be…

>A water scarce country like India

What makes you say that?

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#87

Post by unishark »

hristov wrote: post #41
mardifoufs wrote: post #12

Earlier quoted context omitted.

Latin america and even india are proofs that "pure" protectionism does not work. Even China is an example of free trade working. China opened up massively , reduced customs, reduced costs of doing business etc for 3 decades before moving towards more restrictive and more protectionist policies. After learning as much as possible from foreign corporations that flocked to China. Even now, free trade would be much more…

Latin America is an example how the "free market" theory as espoused by the washington consensus is very bad for developing nations. Latin America is the region that most closely follows the washington consensus and they have suffered for this mightily for this over the post ww2 years. There were little spurts of protectionism in argentina and brasil but those happened only around the 2000s and only as a reaction aft…

> There were little spurts of protectionism in argentina and brasil but those happened only around the 2000s and only as a reaction after many years of gutting the countries under free market policies.

Have you tried selling software or licensing technology to companies in Latin America? In my experience you will need to double or triple your prices because pay a majority of your income in protectionist taxes.

The result is they have local companies selling some select technologies we have, and little or no access to most technology we have.

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#88

Post by aww_dang »

kevin_thibedeau wrote: post #78
missedthecue wrote: post #73

Earlier quoted context omitted.

"People like to pretend that protectionism is such a bad thing" David Ricardo mathematically proved it was a bad thing over 200 years ago. It absolutely befuddles me that people, especially in scientific communities, continue to support its implementation. Hong Kong has always been free trade and their GNP per capita is now greater than all of western europe, barring Norway (which is equal to HK). Protectionism makes…

> their GNP per capita is now greater than all of western europe What if Shenzhen didn't exist across the river? HK is part of a unique economic environment with significant externalities making it prosperous.

Then the capital accumulated in HK would build Shenzhen, again.

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#89

Post by rayiner »

thrwo334324 wrote: post #11
Mekantis wrote: post #2

People like to pretend that protectionism is such a bad thing. But Western nations built themselves through protectionism, it's something China has been doing to great success and the Asian tiger economies (primarily South Korea) did as well. After all, there's only so much you can do for your population if you never ensure a steady supply of high quality jobs that provide a path into the middle class, and you don't…

This is not surprising though, is it ? Britain's "benign civilizing" (schools in anglo-saxon nations have no shame) policies vis-a-vis India were severely skewed against India, and towards protecting her own fledgling industries. Mercantilism, 'a.k.a' Free Trade, was then exactly what China does now - freedom to sell my goods in your place. Opium wars too was all about 'Free Trade'.

> Mercantilism, 'a.k.a' Free Trade

Where do people get this Orwellian Newspeak? Mercantilism is the opposite of free trade. Colonials were prohibited from trading with anyone else, and prohibited from choosing not to trade (were not permitted to have their own industries higher up the value chain). It was not free trade in any respect.

Re: When India kicked out Coca-Cola, local sodas thrived (2019)

#90

Post by fiblye »

missedthecue wrote: post #73
Mekantis wrote: post #2

People like to pretend that protectionism is such a bad thing. But Western nations built themselves through protectionism, it's something China has been doing to great success and the Asian tiger economies (primarily South Korea) did as well. After all, there's only so much you can do for your population if you never ensure a steady supply of high quality jobs that provide a path into the middle class, and you don't…

"People like to pretend that protectionism is such a bad thing" David Ricardo mathematically proved it was a bad thing over 200 years ago. It absolutely befuddles me that people, especially in scientific communities, continue to support its implementation. Hong Kong has always been free trade and their GNP per capita is now greater than all of western europe, barring Norway (which is equal to HK). Protectionism makes…

Because it's a small city with zero resources that acts as a gateway to the Chinese economy as a whole. If China didn't use HK as its economic entry, HK would be absolutely worthless with Singapore relatively nearby and in a much better geographical position.

Larger, independent countries with resources that open themselves to the extent of city states end up selling their resources to the lowest bidder (after the proper hands get a little extra) and having their industries siphoned off to places that'll work for less.

If economics were so easy that the optimal way was mathematically proven 200 years ago, I think economic difficulties would be resolved by now.

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