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Caste and the Indian Economy

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  • Munshi, K.

Abstract

Caste plays a role at every stage of an Indian's economic life; in school, university, the labor market, and into old age. The influence of caste extends beyond private economic activity into the public sphere, where caste politics determines access to public resources. The aggregate evidence indicates that there has been convergence in education, occupations, income, and access to public resources across caste groups in the decades after independence. Some of this convergence is likely due to affirmative action, but caste-based networks could also have played an equalizing role by exploiting the opportunities that became available in a globalizing economy. Ethnic networks were once active in many advanced economies, but ceased to be salient once markets developed. With economic development, it is possible that caste networks will cease to be salient in India. The affirmative action programs may also be rolled back and (statistical) discrimination in urban labor markets may come to an end, if and when there is convergence across caste groups. In the interim period, however, it is important to understand the positive and negative consequences of caste involvement across a variety of spheres in the Indian economy.

Suggested Citation

  • Munshi, K., 2017. "Caste and the Indian Economy," Cambridge Working Papers in Economics 1759, Faculty of Economics, University of Cambridge.
  • Handle: RePEc:cam:camdae:1759
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    More about this item

    Keywords

    Caste; Affirmative Action; Community networks; Migration; Mobility; Education; Business; Risk-Sharing; Public Goods; Politics.;

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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