BharatNotes Dirigisme
noun (mass/uncountable)Usage in a UPSC answer
India's post-Independence development model, anchored in the Mahalanobis strategy and successive Five-Year Plans, reflected a pronounced dirigisme in which the state commanded the "commanding heights" of the economy, until the structural compulsions of the 1991 balance-of-payments crisis forced a decisive turn towards liberalisation.
Synonyms
Antonyms
Word Family
dirigisme (n), dirigiste (adj/n), dirigist (adj)
Root
French diriger = to direct, run; Latin dīrigere = to steer; dis- = apart + regere = to rule
Etymology
From French dirigisme, from diriger ("to direct, to run"), from Latin dīrigere ("to direct, to steer"), from dis- ("apart") + regere ("to rule, to straighten"); first attested in English c. 1951.
Memory Hook
Think "DIRIGISME = the state DIRECTs" — share the Latin root with "direct" and "director": the government acts as economic DIRECTOR, steering the market by the hand.
How This Word Works in UPSC Writing
State direction of the economy. The Indian version rested on a specific and coherent argument rather than on ideology alone, and stating it is what separates analysis from caricature: a late-developing economy with a small domestic market, negligible private capital and no assurance that private investment would flow into heavy industry could not rely on markets to build the capital goods base on which everything else depended, so the state would build it. The Industrial Policy Resolution of 1956 reserved the commanding heights accordingly, and the Mahalanobis strategy of the Second Plan prioritised heavy industry over consumption. The critique that eventually prevailed was not that planning was wrong in principle but that the instruments hardened: industrial licensing meant to direct investment became a barrier to entry protecting incumbents, and controls designed to allocate scarce capital generated rent-seeking and the very shortages they were meant to prevent.
Don’t Confuse It With
Dirigisme means state direction of the economy and is compatible with predominantly private ownership, which distinguishes it from socialism, where the means of production are collectively owned. Central planning of the Soviet type set output targets administratively, whereas Indian planning was indicative for the private sector and directive only for the public. Licence raj is the popular name for the permission regime that implemented it. Commanding heights denotes the sectors reserved to the state under the 1956 resolution.
Hindi Meaning
राज्य निर्देशित अर्थव्यवस्था (rājya nirdeshit arthvyavasthā); लाइसेंस राज for the licence raj.
Common Questions
- How does dirigisme differ from socialism?
- Dirigisme means the state directs the economy while ownership may remain largely private, whereas socialism entails collective or state ownership of the means of production.
- What was the argument for state-led industrialisation?
- That a late developer with little private capital and a small market could not rely on markets to build the heavy industry base, so the state had to build it directly.
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