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Redistribution, Inequality and Political Conflict

  • Patricia Justino

    ()

    (Poverty Research Unit at Sussex)

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.

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File URL: http://www.hicn.org/wordpress/wp-content/uploads/2012/06/wp04.pdf
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Paper provided by Households in Conflict Network in its series HiCN Working Papers with number 05.

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Length: 50 pages
Date of creation: 2004
Date of revision:
Handle: RePEc:hic:wpaper:05
Contact details of provider: Web page: http://www.hicn.org

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  1. Alberto Alesina & Roberto Perotti, 1993. "Income Distribution, Political Instability, and Investment," NBER Working Papers 4486, National Bureau of Economic Research, Inc.
  2. Olson, Mancur, 1963. "Rapid Growth as a Destabilizing Force," The Journal of Economic History, Cambridge University Press, vol. 23(04), pages 529-552, December.
  3. Persson, Torsten & Tabellini, Guido, 1991. "Is Inequality Harmful for Growth? Theory and Evidence," CEPR Discussion Papers 581, C.E.P.R. Discussion Papers.
  4. Christopher Cramer, 2003. "Does inequality cause conflict?," Journal of International Development, John Wiley & Sons, Ltd., vol. 15(4), pages 397-412.
  5. 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 341-45, May.
  6. Xavier Sala-i-Martin, 1995. "Transfers, social safety nets and economic growth," Economics Working Papers 139, Department of Economics and Business, Universitat Pompeu Fabra.
  7. 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.
  8. Keefer, Philip & Knack, Stephen, 2000. "Polarization, politics, and property rights : links between inequality and growth," Policy Research Working Paper Series 2418, The World Bank.
  9. Alesina, Alberto & Rodrik, Dani, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 109(2), pages 465-90, May.
  10. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-65, May-June.
  11. Roland Bénabou, 1996. "Inequality and Growth," NBER Chapters, in: NBER Macroeconomics Annual 1996, Volume 11, pages 11-92 National Bureau of Economic Research, Inc.
  12. Barro, Robert J, 2000. " Inequality and Growth in a Panel of Countries," Journal of Economic Growth, Springer, vol. 5(1), pages 5-32, March.
  13. Perotti, Roberto, 1993. "Political Equilibrium, Income Distribution, and Growth," Review of Economic Studies, Wiley Blackwell, vol. 60(4), pages 755-76, October.
  14. Zeckhauser, Richard J, 1971. "Optimal Mechanisms for Income Transfer," American Economic Review, American Economic Association, vol. 61(3), pages 324-34, June.
  15. Foley, Duncan K., 1978. "State expenditure from a Marxist perspective," Journal of Public Economics, Elsevier, vol. 9(2), pages 221-238, April.
  16. Paul Cashin, 1994. "Government Spending, Taxes, and Economic Growth," IMF Working Papers 94/92, International Monetary Fund.
  17. Betancourt, Roger & Gleason, Suzanne, 2000. "The Allocation of Publicly-Provided Goods to Rural Households in India: On Some Consequences of Caste, Religion and Democracy," World Development, Elsevier, vol. 28(12), pages 2169-2182, December.
  18. Bruno, Michael & Ravallion, Martin & Squire, Lyn, 1996. "Equity and growth in developing countries : old and new perspectives on the policy issues," Policy Research Working Paper Series 1563, The World Bank.
  19. repec:cup:cbooks:9780521282437 is not listed on IDEAS
  20. Perotti, Roberto & Alesina, Alberto, 1996. "Income Distribution, Political Instability, and Investment," Scholarly Articles 4553018, Harvard University Department of Economics.
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