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Does Political Competition Influence Human Development? Evidence from the Indian States

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  • Dash, Bharatee Bhushan

    ()
    (National Institute of Public Finance and Policy)

  • Mukherjee, Sacchidananda

    ()
    (National Institute of Public Finance and Policy)

Abstract

Recently, it has been argued that political competition may have similar effects on economic performance as market competition. This study empirically examines this proposition by linking political competition with the Human Development Index (HDI) of the Indian states. The findings suggest that politically competitive governments perform well along the HDI. A more detailed analysis also shows that the rural India benefits the most from the intense political competition as compared to urban India. We also found that if the same government rules a state for a relatively longer period, it helps the state in achieving higher HDI score. Increasing voter participation found to be positively associated with HDI score, but this finding is confined to the sample of major Indian states only. Increasing public spending on developmental activities is also found to have a positive and significant effect on HDI performance. These findings are robust to various forms of sensitivity analyses.

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Bibliographic Info

Paper provided by National Institute of Public Finance and Policy in its series Working Papers with number 13/118.

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Length: 25
Date of creation: Feb 2013
Date of revision:
Handle: RePEc:npf:wpaper:13/118

Note: Working Paper 118, 2013
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Web page: http://www.nipfp.org.in

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Keywords: Political competition ; Human development ; Indian states;

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  1. Robin Harding & Leonard Wantchekon, 2010. "The Political Economy of Human Development," Human Development Research Papers (2009 to present) HDRP-2010-29, Human Development Report Office (HDRO), United Nations Development Programme (UNDP).
  2. Persson, Torsten & Roland, Gerard & Tabellini, Guido, 1997. "Separation of Powers and Political Accountability," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1163-1202, November.
  3. Tim Besley, 2002. "Political institutions and policy choices: evidence from the United States," IFS Working Papers W02/13, Institute for Fiscal Studies.
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  5. Timothy Besley & Robin Burgess, 2000. "The Political Economy of Government Responsiveness: Theory and Evidence from India," STICERD - Development Economics Papers - From 2008 this series has been superseded by Economic Organisation and Public Policy Discussion Papers 28, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
  6. Dan Andrews & Christopher Jencks & Andrew Leigh, 2009. "Do Rising Top Incomes Lift All Boats?," CAMA Working Papers 2009-17, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
  7. Alessandro Lizzeri & Nicola Persico, 2005. "A Drawback Of Electoral Competition," Journal of the European Economic Association, MIT Press, vol. 3(6), pages 1318-1348, December.
  8. Saibal, Ghosh, 2010. "Does Political Competition Matter for Economic Performance? Evidence from Sub-national Data," MPRA Paper 26603, University Library of Munich, Germany.
  9. Fabio Padovano & Roberto Ricciuti, 2008. "The Political Competition-Economic Performance Puzzle: Evidence from the OECD Countries and the Italian Regions," CESifo Working Paper Series 2411, CESifo Group Munich.
  10. Mukherjee, Sacchidananda & Chakraborty, Debashis, 2010. "Is there any relationship between Economic Growth and Human Development? Evidence from Indian States," MPRA Paper 22997, University Library of Munich, Germany.
  11. Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 371-400, August.
  12. Fabio Padovano & Roberto Ricciuti, 2009. "Political competition and economic performance: evidence from the Italian regions," Public Choice, Springer, vol. 138(3), pages 263-277, March.
  13. Vollmer, Sebastian & Ziegler, Maria, 2009. "Political Institutions and Human Development Does Democracy Fulfill its 'Constructive' and 'Instrumental' Role?," Policy Research Working Paper Series 4818, The World Bank.
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