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Decentralization, Democracy and Allocation of Poverty Alleviation Programs in Rural India

  • Takahiro Sato

    (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan)

  • Katsushi S. Imai

    (Economics, School of Social Sciences, University of Manchester (UK) and RIEB, Kobe University (Japan))

This paper investigates the effect of the devolution of power to the village level government on the household-level allocation of poverty alleviation programs drawing upon National Sample Survey data and the Election Commission's election data. First, greater inequality in land-holdings and less competition between the two major political parties generally lead to less provision of the poverty alleviation programs. Second, the disadvantaged groups were not necessarily likely to be the primary beneficiaries of the poverty alleviation programs. Third, our results based on the natural experiment approach suggest that decentralisation did not lead to wider household access to poverty alleviation programmes during the 1990s. Our results imply the possibility that the power and resources were captured by the local elite after decentralisation, that is, decentralization did not necessarily contribute to the improvement of the welfare of the socially disadvantaged groups.

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File URL: http://www.rieb.kobe-u.ac.jp/academic/ra/dp/English/DP2010-21.pdf
File Function: First version, 2010
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Paper provided by Research Institute for Economics & Business Administration, Kobe University in its series Discussion Paper Series with number DP2010-21.

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Length: 39 pages
Date of creation: Aug 2010
Date of revision:
Handle: RePEc:kob:dpaper:dp2010-21
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