25 April 2013

Excel Lent Depression: Part 2

Microsoft's new offering Office 365(of which Excel is also a part) is being thrust upon 80 lakh Indian college students reports The Hindu. Remember, it was not the fault of Excel that Reinhart and Rogoff did a coding error. Microsoft Excel is the purest spreadsheet that was ever invented. Ha! Ha! How can we ever blame MS Excel if the learned professors made an error in coding?

Is it all hunky dory then? Not at all, as the daily Hindu suggests:

Come June 30, over 80 lakh college students all over India would have little choice but to use Microsoft Office 365 in their college computers, locked by a government contract that may well be more expensive than the use of an open source equivalent in the long run.

The decision by the All India Council of Technical Education (AICTE) will limit engineering students to a particular product at a time when their exposure should be widened, say experts. It also forces college administrations to adopt one technology instead of giving them the flexibility to install whatever suits their students’ needs best, they said.

The Hindu then contrasts open-source software against proprietary software:

Open-source software such as Linux has become popular among college students in recent times as its zero-cost approach promotes inclusivity, with former President Abdul Kalam stating “In India, open source software will have to come and stay in a big way, for the benefit of our billion people.”
Remember there are enough open source Office suites available that are free and are as good if not better than Microsoft Office. Also note that even one rupee is costlier than zero rupees.

The thing about Office 365 (unlike previous MS Office offerings) is that you cannot buy an instance outright. You need to keep paying rental every month. So Microsoft is going to pocket billions every year just by renting out Office 365 to poor college-going Indian students.

Compare the old policy of 'buy once (or download for free, if it happens to be open-source) and use it forever' to the new policy of 'rent once and keep paying forever'.

So will this new policy lead to Excel lent student Depression? Only time will tell.


While Microsoft has no qualms about milking poor Indian students dry, the Company joins the chorus in America in branding Indian software companies like Infosys, Wipro and Tata as outsourcing companies. The result is a proposed comprehensive immigration bill which if passed would bar companies from hiring people on H-1B visa if 50 percent of their employees are not Americans.

Read about this in a recent Times of India Article here.

Excel Lent Depression: Part 1

Krugman, while writing in his blog in The New York Times, titled his recent post 'Excel Depression' . I have gone ahead and tweaked the title and have named my blog 'Excel Lent Depression'. The reason is that Microsoft Excel, which is one of the apps in the Microsoft Office suite, has lent itself to be used and cause a huge depression in Europe. That 'Excel Lent Depression' sounds like 'Excellent Depression' is only incidental. 

The genesis of the story as recounted by Krugman is:

At the beginning of 2010, two Harvard economists, Carmen Reinhart and Kenneth Rogoff, circulated a paper, “Growth in a Time of Debt,” that purported to identify a critical “threshold,” a tipping point, for government indebtedness. Once debt exceeds 90 percent of gross domestic product, they claimed, economic growth drops off sharply.

The problem with this theory, continues Krugman:

First, the learned Professors omitted some data; second, they used unusual and highly questionable statistical procedures; and finally, yes, they made an Excel coding error. Correct these oddities and errors, and you get what other researchers have found: some correlation between high debt and slow growth, with no indication of which is causing which, but no sign at all of that 90 percent “threshold.”

To explain why all this led to Excel Depression, Krugman points out:

Ms. Reinhart and Mr. Rogoff had credibility thanks to a widely admired earlier book on the history of financial crises, and their timing was impeccable. The paper came out just after Greece went into crisis and played right into the desire of many officials to “pivot” from stimulus to austerity. As a result, the paper instantly became famous; it was, and is, surely the most influential economic analysis of recent years.

I know there is something called self fulfilling prophecy. Is there also something called self fulfilling data?

Ah, but the learned Professors while acknowledging the Excel coding error, 'defended their other decisions and claimed that they never asserted that debt necessarily causes slow growth.' This defence is much like the way that I have asserted in this blog that while 'Excel Lent Depression' sounds like 'Excellent Depression', they are totally different. We need to recognise the two as homophonic expressions and nothing more.

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