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Religious identity and the provision of public goods: Evidence from the Indian Princely States

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  • Chaudhary, Latika
  • Rubin, Jared

Abstract

This paper describes a simple model of how a ruler’s religious identity affects public goods provision. Our primary insight is that rulers reduce public goods expenditures to a greater degree when there are privately-provided substitutes excludable by religion.The basic idea is that if the good is provided privately to the ruler’s co-religionists, the ruler faces weaker incentives to provide this public good because his co-religionists receive lower marginal utility from its provision. Testing such a conjecture is an empirical challenge, however, since the religious identity of rulers rarely varies over time and place. We address this problem by exploiting variation in the religion of rulers in the Indian Princely States. Using data from the 1911 and 1931 Indian censuses, we find that Muslim-ruled states had lower Hindu literacy but had no significant impact on Muslim literacy. This result is consistent with our model, as Muslim religious schools provided a substitute for public schools that served both Hindus and Muslims. The model is further substantiated by the fact that the religion of the ruler had no statistically significant impact on railroad ownership or post office provision, neither of which had privately-provided substitutes.

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  • Chaudhary, Latika & Rubin, Jared, 2016. "Religious identity and the provision of public goods: Evidence from the Indian Princely States," Journal of Comparative Economics, Elsevier, vol. 44(3), pages 461-483.
  • Handle: RePEc:eee:jcecon:v:44:y:2016:i:3:p:461-483
    DOI: 10.1016/j.jce.2016.05.001
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    Cited by:

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    2. Sascha O. Becker & Jared Rubin & Ludger Woessmann, 2020. "Religion in Economic History: A Survey," CESifo Working Paper Series 8365, CESifo.
    3. Iyigun, Murat & Rubin, Jared & Seror, Avner, 2021. "A theory of cultural revivals," European Economic Review, Elsevier, vol. 135(C).
    4. Pierre-Guillaume Méon & Ilan Tojerow, 2018. "In God We Learn? The Universal Messages of Religions, their Context-Specific Effects, and the role of Minority Status," Working Papers CEB 16-036, ULB -- Universite Libre de Bruxelles.
    5. Ruth Maria Schüler, 2018. "Bildungsökonomik aus historischer Perspektive," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 78.
    6. Chaudhary, Latika & Rubin, Jared & Iyer, Sriya & Shrivastava, Anand, 2020. "Culture and colonial legacy: Evidence from public goods games," Journal of Economic Behavior & Organization, Elsevier, vol. 173(C), pages 107-129.
    7. Corekcioglu, Gozde, 2021. "Unveiling the effects of a headscarf ban: Evidence from municipal jobs in Turkey," Journal of Comparative Economics, Elsevier, vol. 49(2), pages 382-404.
    8. Sriya Iyer, 2016. "The New Economics of Religion," Journal of Economic Literature, American Economic Association, vol. 54(2), pages 395-441, June.
    9. Cinnirella, Francesco & Schueler, Ruth, 2016. "The Cost of Decentralization: Linguistic Polarization and the Provision of Education," VfS Annual Conference 2016 (Augsburg): Demographic Change 145832, Verein für Socialpolitik / German Economic Association.
    10. Méon, Pierre-Guillaume & Tojerow, Ilan, 2019. "The minority ethic: Rethinking religious denominations, minority status, and educational achievement across the globe," Journal of Comparative Economics, Elsevier, vol. 47(1), pages 196-214.
    11. Aloys L. Prinz & Christian J. Sander, 2020. "Political leadership and the quality of public goods and services: Does religion matter?," Economics of Governance, Springer, vol. 21(4), pages 299-334, December.
    12. Masera, Federico, 2021. "State, religiosity and church participation," Journal of Economic Behavior & Organization, Elsevier, vol. 186(C), pages 269-287.

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    More about this item

    Keywords

    Public goods; Identity; Religion; Literacy; Railroads; Post fffices; Princely States; India; Islam; Hinduism;
    All these keywords.

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • N35 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Asia including Middle East
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • Z12 - Other Special Topics - - Cultural Economics - - - Religion

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