The Boston Globe reports:
What good is a currency that is not even worth the paper it’s printed on? That’s the intriguing question raised by the new “zero rupee note” now circulating in southern India. It looks just like the country’s 50 rupee bill but with some crucial differences: It is printed on just one side on plain paper, it bears a big fat “0” denomination, and it isn’t legal tender.
Essentially, a entrepreneurial charity known as The Fifth Pillar has decided to fight corruption using a ground-up approach. By distributing over a millon valueless rupee bills to residents of the Indian state Tamil Nadu and its surrounding regions, they’ve threatened a widespread culture of corruption which can cost a country like India “tens of billions of dollars” according to the article.
By simply presenting one of these zero Rupee bills the poor across India send a strong signal that the norms of corruption are changing. The point is not just that the road to prosperity is paved with tiny tweaks but that small, technical changes can be leveraged to more wide cultural change.
So while sweeping institutional change like, say, giving supervised elections can often prove useless or worse (they give a veneer of substantive change to what’s just a a change of garb) creating symbols and tweaks at the margin can lead to the real movements.
Of course, this could be taken so far. Not only haven’t the numbers been run independently on the effect of the zero Rupee bills but, more fundamentally, eventually institutional change needs to accompany cultural movements.
(HT: Marginal Revolution)