Trajectories of Subnational Development in Post-independent India

• In Event: Governance and Development at the State and Local Levels in South Asia

Abstract

Trajectories of Subnational Development in Post-Independent India: Why some states are more Redistributive

Understanding why some places are able to provide better living conditions to its citizens remains one of the most important questions in the political economy of development. The question has attracted significant attention in the Indian context. The scholarship on comparative subnational development has been particularly influential in shaping global debates on the growth-vs-redistribution development paradigm. This paper reviews the major theories of redistribution in the field and tests their validity by examining patterns in state-level public spending in all major Indian states over five decades from 1960 to 2012. Contrary to expectation, I find that most existing explanations – political ideology, cultural cohesiveness, electoral participation, party-systems, ethnic diversity, and social bases of voters, are not consistently associated with redistribution. Longitudinal analysis, however, points to three new findings. First, richer states spend more on development, but wealth does not translate to prioritization of redistributive policies, thus emphasizing the need to separate fiscal capacity of the state from the policy preference of ruling governments. Second, ethnic inequality is a better predictor of redistributive spending than both income inequality and ethnic diversity. This has important implications for the scholarship on inequality/diversity and public goods provision. And third, cluster analysis shows that some states have consistently prioritized social development or growth-oriented policies. Echoing the claims of classical literature on the welfare state, this point towards distinct subnational welfare regimes within India.

Author

• Poulomi Chakrabarti, Harvard University