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Religious Identity and the Provision of Public Goods: Evidence from the Indian Princely States

Author

Listed:
  • Latika Chaudhary

    () (Scripps College and Hoover Institute)

  • Jared Rubin

    () (Chapman University)

Abstract

Religious identity affects preferences and can consequently affect policy. We propose two mechanisms through which a ruler's religious identity can affect public good provision: i) greater provision of goods in regions where more subjects are the ruler's co-religionists, and ii) lower provision of goods where private markets provide a substitute to the ruler's co-religionists. Empirically, identifying the causal effect of religious identity on policy is often impossible, since the religious identity of rulers rarely changes over time and place. We address this problem by exploiting the variation in the religion of rulers in the Indian Princely States in the early 20th century. The Indian Princely States had significant variation in the religion of the ruler (primarily Hindu and Muslim), often due to unique historical experiences. Using data from the 1911 census, we fin d that Muslim-ruled states had lower Hindu literacy but the religion of the ruler had no statistically significant impact on Muslim literacy, railroad ownership or post office provision. These results support the idea that rulers provide less public goods when religious institutions provide a substitute targeted at their co-religionists, but there is only weak evidence that rulers provide more public goods when more subjects share their religious identity.

Suggested Citation

  • Latika Chaudhary & Jared Rubin, 2013. "Religious Identity and the Provision of Public Goods: Evidence from the Indian Princely States," Working Papers 13-26, Chapman University, Economic Science Institute.
  • Handle: RePEc:chu:wpaper:13-26
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    References listed on IDEAS

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    Cited by:

    1. Sriya Iyer, 2016. "The New Economics of Religion," Journal of Economic Literature, American Economic Association, vol. 54(2), pages 395-441, June.
    2. Cinnirella, Francesco & Schueler, Ruth M., 2016. "The Cost of Decentralization: Linguistic Polarization and the Provision of Education," CEPR Discussion Papers 11274, C.E.P.R. Discussion Papers.

    More about this item

    Keywords

    identity; public goods; religion; Islam; Hinduism; literacy; India; Princely States;

    JEL classification:

    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • N35 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Asia including Middle East
    • N45 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Asia including Middle East
    • N75 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Asia including Middle East
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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