Ranade on Indian Political Economy

 Ranade on Indian Political Economy

While studying Indian political economy, Ranade reviewed the prevalent theories of economic development. He came to the conclusion that they could not be arbitrarily applied in a backward country like India. He made it clear that as in other social sciences in economics also, time, place, circumstances, endowments and aptitudes of men, their laws, institutions and customs should be taken into account. The laws of classical economics could not be arbitrarily applied because history proved that they were not universal.

Ranade thought that the problem of distribution was not properly tackled by the classical economists. It condemned the poor to poverty and helped the rich to get richer. In this situation freedom of contract became meaningless when the two contracting parties were not evenly matched. "In such case" he wrote "all talk of equality and freedom adds insult to the injury". He supported the right to property but made it clear that the institutions of property and privileges were historical categories and products of social processes.

Ranade was of the view that economics was a social science and its problems should be studied through historical perspective and with social sympathy.