End of the spectrum zamindari

Lord Cornwallis must be turning in his grave at the Supreme Court’s order last week to auction 2G spectrum. The debate about the relative merits of auctions versus administrative allocation that Cornwallis started in 1784 is still going on. Cornwallis, as soon as he became governor-general, overturned his predecessor Warren Hastings’ system of auctioning revenue collection rights to the highest bidders, and switched to a one-time assessment system which he hoped would encourage landlords to think long-term. A cottage industry of Indian economists has flourished debating this decision ever since.

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