Why aren't highways wider

Studies have consistently shown that increasing highway capacity provides only a respite from traffic congestion; eventually the increased capacity will encourage more usage. It is a positive feedback loop.

               Physically there are several issues to consider:

• 20 lane highways would cost an incredible amount to construct.
• 20 lane highways would also require proportionally higher maintenance and replacement costs when compared to normal sized highways.
• A 20 lane highway built in or around a major urban center would require a very wide, continuous piece of land, approximately 300' wide. Typically a piece of land like this isn't available to be developed, so you'd have to buy a tremendous amount of land/property, increasing costs further.
• An extremely wide highway of this sort would require very, very large and complex intersections to allow drivers to exit and enter. Imagine being in the 10th lane from the right and you realize you need to get to an exit off the right most lane in a quarter mile. You'd have to switch lanes ten times in a very short period of time. This is a daunting proposition to say the least.

There are other non physical reasons why this isn't done, first among these is that most locations simply don't require so much highway capacity.

why can't pay indian government world bank loan by just printing money.

Let us say you are a farmer and you have mango plantation (keeping in line with the season's favorite  :P). You do hard labor and work day and night and grow 100 kg mangoes every year. 

Now, one cannot live his life eating only mangoes, And since mango is a good seasonal fruit, good for health, and not to mention utterly delicious, there would be others who'd happily trade their farm products, say wheat, for some of your mangoes. Realizing this, you decide to exchange your mangoes for other products. You tell about it to your friend who has wheat farms. Incidentally, he happens to be a mango lover like me and together you develop a rate of exchange, with mutual understanding of course in this example, say, 5 kg mangoes for 10 kg of wheat. You give him 10 kg mangoes and get 20 kg wheat for your family, which you assume should suffice for 6 months. You do the same thing with your other friends as well in exchange for pulses, rice, vegetables etc.

Now, past 6 months comes winter, and your supplies have started to diminish. Moreover, you do not have any mangoes to offer in exchange for wheat and other commodities. But without the commodities you won't survive for next six months. Now what should, or rather, what could you trade in exchange for wheat?

You find a solution. You go to your best friend who trusts you a lot, and you promise to give him 5 kg of mangoes next summer for 10 kg of wheat right now. He thinks about it for a while. There are of course things to be concerned here. What if you refuse to give him mangoes later? What if the mangoes you give him aren't good quality? What if next year is a drought and there are no mangoes? 

Let us say for the sake of simplicity here that your friend here thinks about it but on goodwill and years of friendship, he trusts you and agrees. Similarly, you go to your other friends, gain their confidence and promise them some mangoes next summer for providing you with supplies right now. Now, what you have done here is that you have developed a trading system wherein you trade items and commodities for other items and commodities. And the trading currency is none other than the "items and commodities".

But now, since you are trading with so many different people at different time, it is getting difficult for you to keep track of how much mangoes you owe to whom. So what you do is that you start handing over promissory notes to the people you trade with, with your sign on it and the amount of mangoes you owe them. So next summer, whenever you have mangoes harvested, people come to you, show you the promissory note with your sign on it, and take the mangoes.

But there is a problem with this system: you are promising X kg of mangoes which you have not harvested yet, i.e., which do not exist. Similarly you would have supplied mangoes to someone for a certain commodity he'll have in future but doesn't have it now. And then there is always a risk factor, i.e., next year maybe a dry one and you may not have enough mangoes to trade.

Realizing this, you are worried now. You need a damage control. You consult this with your trusted friend and ask him how to avoid possible damage. Now this friend of yours is quite a trader himself and has traveled many cities and traded with many people. He tells you not to worry about it and that he'll let you on a little secret. He explains it to you how people will need mango no matter what: after all it is a seasonal fruit and very delicious. Now if there is less growth of mangoes next year, then he can ask to negotiate exchange rates in his favor, i.e., more commodities for same amount of mangoes. Simply put, due to scarcity, his mangoes will become costly.

 You get it a little bit, but you are still confused. You wonder how will you negotiate rates when you do not know how much mangoes you are going to harvest next year; how can you negotiate when there is uncertainty? Your friend smiles, and tells you that you can. He suggests you to issue only a certain value of promissory notes, lets say  1000, and then do the trading with these notes after declaring their new meaning to the traders. These 1000 notes will represent 100% of your harvest, no mater how much you harvest. So if there is a guy with your promissory notes valuing to 100, he''ll have 10% of your harvest next summer, no matter how much you harvest. He can also decide to not exchange it for mangoes next year when there is a drought, and wait for next to next year hoping for more amount of mangoes then. Lets call your promissory notes as Mango Currency (MC) 

All goes good and the mangoes, being good quality and sweeter than its competitors, are valued more. People want to buy mangoes from you even if they have to pay more. This means the value of MC gets more, only a few people can afford it. The very lower class, who wants to eat mangoes but cannot get hold of MC due to its high value is suffering. This also causes you loss in business since people are now holding MC instead of trading it for mangoes since the value is increasing. Since mangoes are not being traded, they are rotting in the collecting compound with very less people to buy them, causing you huge loss. You now need to keep the value of MC in check so that people do not hold up to it. 

You go to your friend again and consult him on how to keep value of MC in check. He tells you to simply issue more promissory notes. Since the total sum of promissory notes is equal to 100 % of your harvest, if you issue 1000 more promissory notes in addition to the initial 1000 that you've had, the value of MC would be halved. 100 MC that was 10% of the harvest would now only be 5% of your harvest. (This is also how RBI keeps the value of Rupee under check, else Economic activity of country would go down)

Now you have developed a good trade system and also know how to keep the value of MC under check by regulating the supply of promissory notes. Now you decide to expand your business. You go to your best friend who deals in wheat and has currency WC (Wheat Currency). He is already doing very good in business and has surplus money. You tell him about your plans to expand our business and your requirement of more money for expansion purpose. He listens to you and agrees to lend you some money at certain interest rate: he already has enough money and extra money sitting at home isn't earning him anything, so lending it to you for certain interest seems a good deal.

You borrow 500 WC from him. Now WC is quite strong in market. So much that 500 WC costs around 1000 MC (how much % of wheat harvest it represents doesn't matter). 

Now, you use up all the WC for expansion but suffer heavy losses. All the WC went down into the drain. You bought some stuff from it and have it still, but it is not bringing you any revenue and nobody is ready to buy it back. You are now left with only a few MC (remember, your currency is also floating in the market; you have maybe 1200 MC at hand). To pay back 500 WC, you need 1000 MC. But if you give 1000 MC right now, your remaining business will not be able to sustain itself with only 200 MC at disposal and you'll eventually end up bankrupt.

 You now think about possible way out. You plan to issue 2000 MC more, exchange 1000 MC for WC and return the loan. But if you issue more MC, the value of MC will be halved. Moreover, you can not think of cheating because the value of various currencies is now checked by Association of Auditors and you need to report any more printing of currency to them before it can be floated in the market, and all the currencies are numbered to keep the authenticity in check

Basically, you are now left with only one option: to try to get your act together and grow your business back to what it was, and then further more to get enough MC with sufficient value, to be able to return the loan amount. 

Now in the above scenario, lets replace you with our country India, and replace mangoes you harvest with the economic activity that takes place in country; and replace your promissory notes, valuing to 100% of your harvest, to 100% of the economic activity in the country.

Now, back to your question: What happens when RBI prints more money to pay off bank loans? You should be able to guess it. More the money printed, lesser the value of currency. Money flowing in the country is nothing but standardized promissory notes issued by RBI. They are equivalent to the total economic activity of the country. If the economic activity does not increase in proportion to the money printed by RBI, the value of Indian Rupee will go down.

And obviously, value of MC will go down with respect to promissory notes issued by other people for other commodities. So when value of Rupee goes down, it does w.r.t other currencies, USD being one of them. 

Its not difficult to guess that loans provided by World Bank are in USD. If money is printed to pay off the loan, value of Rupee goes down, which means you need more Indian Rupee to buy USD. As you can see, you can not repay the loan unless you actually have the money, over and above what you 'll need to run the country.

P.S.: Up-vote and Comment..  ;)   :P

P.P.S.: In case of any wrong concept/explanation, please comment such, so that changes can be made.

How do countries devalue currency

On 6th June, 1966 India, hit by drought after two major wars (with China and Pakistan), devalued rupee by a massive rate: from Rs.4.76=$1 to Rs.7.50 = $1(57% devaluation). Again in July 1991, hit by gulf war and collapse of Soviet Union (India's main trading partner then), India devalued rupee from Rs.18=$1 to Rs.25 to $1. [June is a bad time for Indian rupee] .    Historical Exchange Rate Regime of Asian Countries.

Devaluation is usually a conscious process of  controlling currency in a fixed rate regime. To do this, the government  (that controls the forex market tightly) just have to announce that they  are moving to a new level against the dollar.

----

Let me use this opportunity to explain how exchange rates work.

The state of Earthopia has 3 villages - Kumar Ville, Huville and Johnville. Initially they were all self-sufficient, with each of the villages producing all the rice, vegetables, brick and clothes required for all their inhabitants. Things are working so great since eternity.

Now, some villagers in Johnville found a new, faster way to make bricks. Thus, they started producing faster than the villagers there could buy. So, they thought they could sell some of them to the villagers in Huville that is going through a rainy season. In return for the bricks, Huville guys thankfully gave some extra rice. Johnville guys didn't need much rice, so they were willing to offer only one extra brick for every 10 bags of rice.

Meanwhile, Kumarville  is going through a drought season and go to beg the Johnville guys. So the John guys give them bags of rice, in return for the large pile of clothes. 

The exchange process was however complex. The barter system had so many issues (see more here:

What would a world without money be like?   So, a tribal leader from Johnville, let us call him Hamilson, thought he could use some specially made coins. He calls the specially made coins Daluro. He sets 1 brick equals 1 Daluro. Thus, Huville and Kumarville guys need to get these Daluro to buy stuff from Johnville guys.

Not to be left behind, the tribes of Kumarville and Huville give colorful names Rapi and Rambi to their own coins. 1 Rapi is set as 10 pair of clothes and 1 Rambi is set as 10 bags of rice. These coins are then used among the villagers to buy and sell stuff among themselves. At the current rate: 1 Rapi = 1 Rambi = 1 Daluro.   -- Equation 1.

Life is so good for Johnville people as they are getting a lot of , clothes and rice without working much. As the brick guys keep working hard, others start relaxing more. the new tribal leader Burke Bun is happy with this.

The drought in Kumarville ends and they start producing a lot of rice. Now, they are not in that need for the rice from Johnville and have a less need for Daluro. As richie's required less, Kumarville guys are willing to sell only 5 clothes for every 10 bags of rice. By previous equations, now 1 Rapi10 clothes = 20 bags of rice = 2 Daluro.

In the meanwhile, Huville have adapted a part of brick building process and have started producing enough bricks. They are now less willing to buy bricks from Johnville. They now set 1 Rambi = 10 bags of rice = 3 bricks = 3 Daluro.

This leaves the Johnville tribes with no options but to devalue their currency to accept the reality that 1 Daluro = 0.5 Rapi = 0.33 Rambi. This spurs the local farmers and weavers who can no longer buy rice and clothes from outside and start getting back to work again.

Devaluation is essentially recognizing that one's currency is significantly less than what it used to be. This happens when a country is not letting its currency trade in the markets and essentially sets how much its currency is set to a dollar or other currency. Devaluation is a sudden, overnight change.

Other answers are confusing the natural process of currency depreciation  (through inflation) with devaluation. Devaluation means a country's  government (and central bank) announces overnight a big change in the  country's exchange rate. It is usually a conscious process of  controlling currency in a fixed rate regime. To do this, the government  (that controls the forex market tightly) just have to announce that they  are moving to a new level against the dollar.

What would happen if USD = INR 1

                             Let us assume that such an event happens overnight without a drastic change in productivity or a massive drop in real wages. 

A good Indian engineer makes Rs.75,000 per month. Skills wise, this guy might be comparable to a guy making $3000 in the US. 

What if 1 USD becomes 1 INR and this guy's productivity and salary stays the same? The Indian guy's salary becomes equal to $75,000. Before he is happy with his paycheck and go on to buy hot gadgets from the Apple store, a few things change. 

Why would a company pay him $75,000 when you can get someone for $3000 in the US? Of course they would not. So, every Indian - engineers, teachers, accountants, designers - would be fired from their jobs and jobs would move out of the country as workers are cheaper outside India. Where you cannot move the job outside India (such as cleaning), companies would find tech. An awesome robotic vacuum cleaner worth $1000 would be used rather than the $4000 pm human cleaner. As people get removed from the jobs, plenty of other jobs that rely on them (restaurants, cafes, retail shops, tourism, airlines...) go kaput.

As people get fired, they will be ready to work for lower and lower salaries, until their salary drops below the international level of say $2500. Since 1 USD = 1 INR, that would make great engineers make Rs.2500 pm. How would they pay their EMI (mortgage) on homes, cars and gadgets? They cannot and they would default. 

The banks would have huge unpaid loans and they will go bankrupt. Investors would exit and government would have print a lot of money to keep the banks alive. That would spike up the inflation and push down the rupee so much that things get back Rs. 60 = 1 USD. At that point, the Indian's wage will be so low that jobs will move back again and the cycle would continue.

There are plenty of real life examples of this. In 1986, Japanese yen doubled in strength. $1 was about 280 yens until then and that suddenly become like $1=140 yens. Just that completely screwed Japanese economy, from which they never recovered. Why did Japan increase their currency strength if they knew things are going to get worse? It is because the Americans forced them to do so         

This is the reason why RBI is very careful not to let rupee too strong. It is to India's advantage that $1 equal Rs.60. It helps keep exports high, wages high and imports low.

Ultimately the strength of a currency depends on only two things:

1. Productivity of the people. If every guy making Rs.75000 pm is able to produce 25 times more output than a foreigner making $3000, then India can enjoy $1 = Rs.1.
2. Inflation. If a country goes through a sustained low inflation in relation to other countries, its currency would move up. That means after 100 years, if your salaries stays the same at Rs.75000 pm while America's inflation takes an average guy there's salary to $75000, then $1 = Rs. 1

As simple as that. Since, the second scenario is bad, we need to focus only on the first scenario. How do we get an average Indian produce many times more than a foreigner?

EDIT: Based on the comments, I see that people are quite confused by what the currency rates mean. People assume somehow that $1 = 60 Rs means US is stronger than India. By that logic, 1 Bangladeshi Taka that equals 1.5 Yen, means the Bangladeshi economy is stronger than Japan's?

Currencies had arbitrary starting points. In 1898, the British government fixed 1 rupee equaled 1 shilling and 4 pence (1 pound = 15 rupees). You could have set anything. You could have said 1 rupee equals 10,000 pounds as the starting point and designed the economy that way. It would not have mattered at all. The starting points are merely for convenience. 

What matters is, whether the currency is moving up or down over long time.  The rupee has gone down against the pound over the last 115 years and that is an indication that India's productivity has not kept up and/or the inflation was high relative to UK.

  1. Eclectic Economics.

  

   2.Why has Indian rupee devalued from around ₹5 per $1 at independence to around ₹60 per $1 today?

   

"why are international students less administrative universities like harvard"

In short, because there is only a limited number of international students they can admit, but relative to the number of international spots, there are A LOT more international applicants. The acceptance rate for international students are often less than 1/10 or even 1/20 compared to domestic applicants. For example, Stanford's international acceptance rate was < 1% when the domestic was still at 10%. 

Keep in mind not all international students are the same. Applicants from East Asia have it worst, but applicants from Africa and South America have it considerably easier. 

1) International students are less knowledgeable about American universities. As a result, most of them shoot for the top schools as "reach", but their target and safety schools vary a lot. So while an American student may pick 2-3 reaches, 3-5 targets, and 2-3 safeties, the international student is more likely to apply to 5+ reaches, and their targets tend to vary starting from colleges ranking 30 and below. Therefore, for colleges that are ranked 30 - 100, it may be easier for international students to get in. 

2) International students have little incentive to go to state schools. A lot of state schools have 3 tiers for tuition: in-state, out-of-state, and international. Often times, the state school costs almost as much as the private school. To put it another way, going to a less competitive university costs almost as much as going to a competitive university. Therefore, they have more incentive to try to go to a more competitive university. 

3) International students (at least ones from East Asia) tend to have similar profiles. Since most of us cannot compete with Americans in English/humanities, we tend to try to distinguish ourselves with math/science abilities. However, since college admissions is about building a diverse class, you want top math people from abroad AND from the US, so you can't take all the IMO/IOI gold medalists. People who may be top in English in their own country are likely still not that good relative to native speakers, so it makes them less competitive.

sources : Quara 

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what are india advantages over china

                                           "What are india's advantages over china"

 Overall China has plenty more advantages than India. However, in a few aspects, India has an edge.  has
 already covered a few.

Chaos and Diversity: In India, we were born in chaos. If we were not nimble/adapting, we wouldn't survive. We had to learn multiple languages, just to cross a state within India. Luckily for us, the world is also chaotic and diverse. Thus, moving to Boston or Barcelona for studies/work is not any more difficult than moving to Delhi/Kolkata. Thus, Indians are extremely comfortable globetrotters and the ones who are leveraging the recent globalization the most.

Also, what the Indians have been doing with Jugaad [hacking] is what's needed for programmers, designers, entrepreneurs and any modern worker. In a globalized world with emphasis on entrepreneurship everywhere, Indians have an edge due to the shit our politicians created and our adaptation to deal with the shit.

Conformity vs. Confrontation: China's historic strength is in its conformity. On various occasions "One China" roar would be spoken and people will become united. This strength got transferred to its manufacturing industries. If you are building roads and factories, you have to conform to things. Indians are traditionally non-confirming and argumentative. That runs in our blood and in our religions. This is why we were not able to build good roads or manufacturing infrastructure. However, this core stress on "questioning" is helpful in modern-day industries. For every Indian, there are 30 different viewpoints. 

Sunrise/Sunset Industries:Lot of what China does is what West doesn't want to do - making toys and shoes. Lot of what India does - software, finance, marketing, pharmacy, consulting - is what West wants to do. Although China is strong in software and soft-aspects, India has a relatively high share of it as % of GDP and an edge due to its historic strengths. A decade ago, I wrote a blog post on this, that I believe is still relevant: India and China - A different viewpoint In short, India is going after the right things. 

Low hanging fruits: China has gone to a stage where its long hanging development fruits have been plucked and utilized. India has in plenty. 700 million Indians don't have a place to shit properly and 500 million Indians can't even write their name. What you see as a problem is an opportunity for me. It is not a rocket science to make someone literate or build a toilet. Every other country has done it and we just have to copy. With simple things like these we can maintain 10% GDP growth rate. 

Political risks: If India were not a democracy, it would have imploded. Both Hinduism and Indian version of democracy have inbuilt unique stress release mechanisms. Many outsiders don't understand it and often confounded by how we exist as one nation. It is our secret sauce. Although some Indians derisively call it as chalet hoi [Let it be] attitude, this is how we survived 1000s of years of hardships. Since we are able to release our stress by ganging up on poor jokers like Rahul Gandhi [a 70kg stress ball], we are in a better position to avoid any future revolution/major political risks. Chinese citizens are getting increasingly angry at various things [being unable to easily vent it out on the political class] and there is a big political risk for CCP and overall society. 

Geopolitical risks: China is a dragon. It is ambitious and sooner or later it will start to dominate. That carries a huge geopolitical risk. A confrontation with Vietnam, Japan, Taiwan or US could impact its trade-centric economy. India is an elephant. It is fairly comfortable being a giant, feeding on just grass.

 get to the level of prosperity at the time of Asoka, Raja Raja or Samudragupta, we are happy.

Strategic position: India has a few more strategic advantages than China by virtue of its location. Indian Ocean in a very critical pathway for global energy and other commodities. India is the only major power in the Ocean. CanIndia Blockade China? China knows this and is building up its bases in Indian Ocean via Pakistan, Myanmar etc.

Source : Quora 

                                                                         Thanking you.

What made the USA so powerful?

                                                    What made the USA so powerful?

There's one item that I think everyone missed in their catalogs of natural advantages:  ports and rivers

I did a stint as an intern at Stratford; one of the things I learned there that boggled my mind was that, if

  combine the Mississippi river basin and the intracoastal waterways on the Gulf Coast and eastern seaboard, the U.S. has more miles of navigable inland waterways than the rest of the world combined!  [source] 

Yes, you read that right.  Not just more than any other country.  More than ALL of them.  And the consequences of that were and still are enormous.  Not only that:  the East Coast alone also has more major ports than the entire rest of the Western Hemisphere.

Waterways are still, to this day, the best and cheapest kind of transportation infrastructure - even today, with modern trains and trucks, it costs at least 10 times as much to transport goods by land as it does by water - and the US got huge amounts of that transportation infrastructure almost from the start, mostly for free or at very low cost.  When you look back at US history, the role that these ports and waterways played was huge.  The Charles, Connecticut, Hudson, Delaware, Potomac, Roanoke, and Savannah rivers, among others, played crucial roles in settling and growing the original colonies.  The fact that even the mighty British Navy couldn't possibly blockade all the Colonial ports was THE key to the success of the Revolution.  And of course the entire Mississippi basin with all its tributaries is unmatched anywhere and still carries most of the heartland's trade with the world.

If you raise the center of the continent up and throw a dozen waterfalls and rapids onto each of the rivers in the Mississippi basin, the history of North America would have been radically different.  All that rich interior land that Dan Holliday eloquently described would have been worth only a tiny fraction of what it was and still is worth without a good cheap way to get that produce to the sea.  The river system was what made it possible to conquer, settle, and hold a huge nation even before railroads, and it was the multiplier that made the U.S. rich long before it "should" have been.

Rivers and ports.  We got ‘em!

Source : Quora