Demonetization: Evaluating the critics
Most claims against it are untenable; note ban is more than a one-time step jump
Abstract:
Last week has seen a contentious debate on demonetisation replay itself. Predictably, critics have gone on to make several untenable claims. The present article challenges three of them.
Claim 1: With nearly all of the high-denomination notes returned to the banking system, the primary objective of demonetisation — extinguishing unaccounted cash — has been wholly defeated. This claim is false on two counts. First, the primary objective of demonetisation was combating corruption, not extinguishing unaccounted cash.