The Problem of the Rupee, Its Origin and Its Solution

"The Problem of the Rupee, Its Origin and Its Solution" by B. R. Ambedkar is a socio-economic treatise written in the early 20th century. This work delves into the intricacies of the Indian currency system, tracing its historical evolution, its theoretical foundations, and presenting potential solutions to the challenges it faces. The author critically examines the transformation of the Indian currency from a gold standard to a gold exchange standard, emphasizing the implications for the rupee's stability and purchasing power. The opening portion of the text lays a groundwork for understanding the complexities of currency in India, particularly during the colonial period. Ambedkar argues that the transition from a double standard of gold and silver to a silver monometallic standard was riddled with errors and ultimately led to economic instability. He highlights the inadequacies of existing currency reforms and critiques the prevailing opinions of other economists, including John Maynard Keynes, asserting that merely addressing surface symptoms of currency issues will not suffice. Instead, Ambedkar posits that a more radically structured currency, possibly involving an inconvertible rupee with a controlled issuance, would offer a more stable economic foundation for India moving forward.