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Redistribution, Inequality and Political Conflict

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  • Patricia Justino

    () (Poverty Research Unit at Sussex)

Abstract

This paper analyses the relationship between redistributive policies and civil unrest. This relationship is modelled in a discrete two-period recursive model. Key theoretical assumptions and outcomes are tested empirically using data for a panel of 14 major Indian states between 1973 and 2000. The analysis shows that, in the medium-term, redistributive policies have been significantly more effective in reducing civil unrest in India than more direct solutions, such as the use of police and military forces, and have resulted in important positive externalities on economic growth. This represents an important lesson for countries where social cohesion tends to break frequently but large-scale wars may be avoidable.

Suggested Citation

  • Patricia Justino, 2004. "Redistribution, Inequality and Political Conflict," HiCN Working Papers 05, Households in Conflict Network.
  • Handle: RePEc:hic:wpaper:05
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    References listed on IDEAS

    as
    1. Alberto Alesina & Dani Rodrik, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, Oxford University Press, pages 465-490.
    2. Xavier Sala-i-Martin, 1996. "Transfers, Social Safety Nets, and Economic Growth," IMF Working Papers 96/40, International Monetary Fund.
    3. Olson, Mancur, 1963. "Rapid Growth as a Destabilizing Force," The Journal of Economic History, Cambridge University Press, vol. 23(04), pages 529-552, December.
    4. Alesina, Alberto & Perotti, Roberto, 1996. "Income distribution, political instability, and investment," European Economic Review, Elsevier, vol. 40(6), pages 1203-1228, June.
    5. Roberto Perotti, 1993. "Political Equilibrium, Income Distribution, and Growth," Review of Economic Studies, Oxford University Press, vol. 60(4), pages 755-776.
    6. Patricia Justino & Julie Litchfield, 2003. "Poverty Dynamics in Rural Vietnam: Winners and Losers During Reform," PRUS Working Papers 10, Poverty Research Unit at Sussex, University of Sussex.
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    8. Persson, Torsten & Tabellini, Guido, 1991. "Is Inequality Harmful for Growth? Theory and Evidence," CEPR Discussion Papers 581, C.E.P.R. Discussion Papers.
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    20. Gintis, Herbert & Bowles, Samuel, 1982. "The Welfare State and Long-Term Economic Growth: Marxian, Neoclassical, and Keynesian Approaches," American Economic Review, American Economic Association, vol. 72(2), pages 341-345, May.
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    Citations

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    Cited by:

    1. Dominic Rohner, 2010. "From rags to rifles: deprivation, conflict and the welfare state," IEW - Working Papers 463, Institute for Empirical Research in Economics - University of Zurich.
    2. Rohner, Dominic, 2011. "Reputation, group structure and social tensions," Journal of Development Economics, Elsevier, pages 188-199.
    3. Patricia Justino, 2009. "The Impact of Armed Civil Conflict on Household Welfare and Policy Responses," HiCN Working Papers 61, Households in Conflict Network.
    4. Umit Hacioglu & Hasan Dincer & Ismail Erkan Celik, 2012. "Economic Approach to Conflict Issue: Investment in Post- Conflict Situation for International Business," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 3(5), pages 1-8, September.
    5. Rohner, D., 2007. "From Rags to Rifles: The Economics of Deprivation, Conflict and Welfare State," Cambridge Working Papers in Economics 0771, Faculty of Economics, University of Cambridge.
    6. Vadlamannati, Krishna Chaitanya, 2008. "Socioeconomic, Institutional & Political Determinants Of Human Rights Abuses: A Subnational Study Of India, 1993 – 2002," MPRA Paper 10142, University Library of Munich, Germany.
    7. Patricia Justino, 2006. "On the Links between Violent Conflict and Chronic Poverty: How Much Do We Really Know?," HiCN Working Papers 18, Households in Conflict Network.

    More about this item

    Keywords

    redistribution; conflict; inequality; economic growth; India; panel data;

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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