Public Freebies and its Impact on the Economy, Productivity and Democracy in India

Abstract

Freebies are public welfare measures,  goods or services, offered free of cost by the government. It is a well-established phenomenon that every election season, political parties across the country make ambitious commitments in a tender for electoral success. These political parties with an objective to win elections promise various freebies like electricity, water and transportation services and others. High powered subsidies not only jeopardise a State’s fiscal health, but also put substantial opportunity costs, limiting the funding available for other social programmes. For example, In the budget allocations of the state of  Karnataka health and education are much lower than the average allocations of funds in these sectors by all other States of the country.