Nobel Prize-winning economist Joseph Stiglitz of Columbia University has black-flagged the central government's decision to allow foreign direct investment (FDI) in retail.
Delivering a lecture on 'Redefining Capitalism', in Patna on Monday, Stiglitz spoke of the 'monopsony power' of a retailer (evidently referring to US retail giant Wal-Mart) waiting to enter India, which would bring little to the table.
"This particular retailer can use its immense clout to displace Indian goods in the market to the detriment of small manufacturers and retailers," he said.
"This retailer is also known for bribery in Mexico. But then Indians have their own expertise in this matter," the Nobel laureate said.
Stiglitz also argued there was no such thing as an ideal capitalism model.
"Capitalism has to be continually redefined. Each country has to decide what kind of market economy is ideal for it by way of benefiting the largest number of its citizens. The state's role is critical in making a success of the model adopted," he said.
The former World Bank chief economist warned that countries copying the US model of capitalism ran the risk of ending up in a soup as inequality, especially of opportunity, remained a serious problem in the country.