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Political Determinants of the Allocation of Public Expenditures: A Study of the Indian States

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  • Dash, Bharatee Bhusana

    (National Institute of Public Finance and Policy)

  • Raja, Angara V.

    (Dept. of Economics, University of Hyderabad)

Abstract

This study examines whether the allocation of public expenditures of the Indian states are significantly influenced by government specific political characteristics. Three types of government specific characteristics are considered: forms of governments, ideology of the government, and the electoral cycle. A number of hypotheses are designed to link these characteristics with expenditure allocation. The hypotheses are tested using a panel dataset of 14 Indian states spread over 27 fiscal years, from 1980-81 to 2006-07. The overall findings of the study suggest that the relationship between expenditure allocation and political determinants across the Indian states validate the proposed hypotheses even after controlling for the traditional and other unobservable determinants. These findings are robust to various forms of sensitivity analyses.

Suggested Citation

  • Dash, Bharatee Bhusana & Raja, Angara V., 2012. "Political Determinants of the Allocation of Public Expenditures: A Study of the Indian States," Working Papers 12/101, National Institute of Public Finance and Policy.
    • Handle: RePEc:npf:wpaper:12/101
    Note: Working Paper 101, 2012
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    References listed on IDEAS

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    Cited by:

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    5. Anirban Karak & Deepankar Basu, 2020. "Profitability or Industrial Relations: What Explains Manufacturing Performance across Indian States?," Development and Change, International Institute of Social Studies, vol. 51(3), pages 817-842, May.

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    More about this item

    Keywords

    Political determinants ; Expenditure ; Political parties ; Interest groups ; Indian states;
    All these keywords.

    JEL classification:

    • H0 - Public Economics - - General
    • H1 - Public Economics - - Structure and Scope of Government
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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