The more billionaires the merrier? Depends on how you made the money.

“The richest man in India, Azim Premji, is worth $10 billion. The 4 richest people in India (Premji, The Ambanis, Sunil Mittal) are worth more than the top 40 richest Chinese.”  ----- China vs India: Some random numbers, Indian Economy Blog

“Those Who Dare blog” is particularly unhappy about this comparison though. See “An economic dick measuring contest”

Is “more billionaires” a good or bad thing?

It depends on how they made the money. Recently I read a study done by professors Randall Morck, David Stangeland and Bernard Yeung on the economic consequences of Forbes billionaires on their home countries.

They find that:

“Countries in which billionaire heirs' wealth is large relative to G.D.P. grow more slowly, show signs of more political rent-seeking, and spend less on innovation than do other countries at similar levels of development. In contrast, countries in which self-made entrepreneur billionaire wealth is large relative to G.D.P. grow more rapidly and show fewer signs of rent seeking.”

Well, some of the Indian rich are indeed self-made entrepreneurs, but most of them are not. But at least there are some hopes, as those emerging from IT industry are more likely to be self-made. Please check Forbes' list of the richest 40 Indians, and find out how many of them are inherited and how many are self-made.

Morck et al. further suggest the old money, the inherited billionaires,  always oppose capital market and goods market openness through their entrenched and enhanced lobbying power, because they have vested interest in preserving the value of existing capital.

This is true in India. No one believes that Indian government adopts protectionism polices for the welfare of Indians. Only those incumbent rich benefit from these polices; as consumers they buy luxury goods in London, thus they won’t be hurt as consumers but only benefit overwhelmingly as monopoly producers. Ordinary Indians suffer as a result.

Reference:
Inherited Wealth, Corporate Control and Economic Growth: The Canadian Disease (PDF file)