Exam Prep Towns as GDP Sink

Updated: 2025.09.02 1M ago 3 sources
In India, years‑long cramming for scarce, high‑paying government posts creates queues that build no marketable skills and sideline the country’s most educated youth. Back‑of‑envelope losses are about 1.4% of GDP annually for India, while Brazil’s modeled rent‑seeking costs from public job applications reach 3.61% of output. Meritocratic exams can function as large‑scale rent extraction when pay is mispriced. — It shifts debates on 'meritocracy' toward incentive design by showing exam systems can drain human capital at national scale.

Sources

Could China Have Gone Christian?
Alex Tabarrok 2025.09.02 65% relevant
Tabarrok explicitly connects Hong Xiuquan’s repeated failures on China’s civil‑service exams to the modern Indian 'mass exams' phenomenon that produces large numbers of educated but frustrated youth, echoing the idea that exam‑centric systems misallocate talent and create instability costs.
Singapore’s Pay Model Isn’t India’s: Market Wages vs. Civil-Service Rents
Alex Tabarrok 2025.08.27 70% relevant
By highlighting Italy’s 85,000 applicants for 30 bank jobs and noting Singapore doesn’t need mass entrance exams when wages are market-aligned, it connects rent-seeking queues to wasted human capital.
India, Greece, Brazil: How High Government Pay Wastes Talent and Drains Productivity
Alex Tabarrok 2025.08.25 100% relevant
Tabarrok’s India estimates and Cavalcanti & Santos’s 3.61% output loss for Brazil.
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