On Thursday, the Economic Survey tabled in parliament suggests invoking the doctrine of “pious obligation” as well as blend principles of behavioral economics with the spiritual norm to tackle tax evasion and willful defaults.

Tenets of Hinduism, Islam, and Christianity have been cited extensively to tackle debt woes and evasion by the Economic Survey, and that it also aims to bring a sense of novelty and provides a detailed picture of the economy in 2018-19 and the way ahead.

Such suggestions find a place the chapter titled ‘Policy for Homo Sapiens, Not 02 Homo Economicus: Leveraging the Behavioural Economics of “Nudge”‘. It has been said in the Economic Survey that real people made decisions are often contrasted from the impractical robots theorized in classical economics. It said due to drawing on the psychology of human behavior, behavioral economics provides insights to nudge people towards desirable behavior.

The survey,  formed by a team led by Chief Economic Adviser KV Subramanian said that the “doctrine of pious obligations” could be invoked to encourage people to clear their debts and also pay taxes.

“Given the importance of religion in Indian culture, the principles of behavioral economics need to be combined with this spiritual/religious norm to reduce tax evasion and wilful default in the country,” the survey observed.

The Economic Survey notes that in India behavioral economics can be used as an important instrument for change as social and religious norms play such a dominant role in influencing behavior. “So, beneficial social norms can be furthered by drawing attention to positive influencers, especially friends/neighbors that represent role models with which people can identify,” it said.

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