UPSC Prelims 2021 CSAT Paper II · Q61 of 79 Comprehension medium

Passage

Can a democracy avoid being a welfare state for long ? Why cannot mass welfare be left entirely to the markets ? There is a built-in tension between markets and democracy. Markets do not work on a one-person-one-vote principle as democracies do. What one gets out of the market place depends on one's endowments, skills, purchasing power and the forces of demand and supply. Markets reward individual initiative and skill, and may also lift many from the bottom rungs of society, but some people never get the opportunity to develop skills that markets demand; they are simply too poor and too handicapped; or skill formation takes too long. By creating jobs, markets may be able to help even unskilled people, but capitalism has always witnessed bursts of unemployment.

With reference to the above passage, the following assumptions have been made : 1. Modern democracies rely on the market forces to enable them to be welfare states. 2. Markets ensure sufficient economic growth necessary for democracies to be effective. 3. Government programmes are needed for those left behind in economic growth. Which of the above assumptions is/are valid ?

  1. (a) 1 and 3 only
  2. (b) 3 only ✓ UPSC's answer
  3. (c) 2 and 3 only
  4. (d) 1, 2 and 3

Why the answer is (b)

• The passage states that markets do not work on a one-person-one-vote principle and that outcomes depend on endowments, skills, and purchasing power, which contradicts the assumption that democracies rely on market forces to be welfare states.

• The text highlights that some people are 'too poor and too handicapped' to develop market-demanded skills and that capitalism witnesses 'bursts of unemployment,' indicating that markets do not guarantee sufficient growth or opportunity for all.

• The passage explicitly argues that because markets fail to provide opportunities for the disadvantaged and cannot ensure mass welfare, there is a built-in tension between markets and democracy.

• Therefore, the only valid inference is that government intervention or programmes are necessary to address the gap left by market failures for those who are left behind.

• Consequently, only Assumption 3 is supported by the text, making option (b) the correct answer.

Why the other options are wrong

(a) 1 and 3 only
Assumption 1 is invalid because the passage argues that markets do not operate on democratic principles and often fail to provide welfare to the disadvantaged.
(c) 2 and 3 only
Assumption 2 is invalid because the passage states that markets reward individual initiative and may witness bursts of unemployment, rather than ensuring sufficient growth for all.
(d) 1, 2 and 3
Assumptions 1 and 2 are invalid because the passage emphasizes the limitations of markets in providing mass welfare and equal opportunity, contradicting the idea that they ensure democratic effectiveness or welfare.

Asked in the CSAT Paper II of the UPSC Civil Services Preliminary Examination 2021, held on 10 October 2021. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.

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