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Does Political Competition Influence Human Development? Evidence from the Indian States

  • Dash, Bharatee Bhushan

    ()

    (National Institute of Public Finance and Policy)

  • Mukherjee, Sacchidananda

    ()

    (National Institute of Public Finance and Policy)

Recently, it has been argued that political competition may have similar effects on economic performance as market competition. This study empirically examines this proposition by linking political competition with the Human Development Index (HDI) of the Indian states. The findings suggest that politically competitive governments perform well along the HDI. A more detailed analysis also shows that the rural India benefits the most from the intense political competition as compared to urban India. We also found that if the same government rules a state for a relatively longer period, it helps the state in achieving higher HDI score. Increasing voter participation found to be positively associated with HDI score, but this finding is confined to the sample of major Indian states only. Increasing public spending on developmental activities is also found to have a positive and significant effect on HDI performance. These findings are robust to various forms of sensitivity analyses.

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Paper provided by National Institute of Public Finance and Policy in its series Working Papers with number 13/118.

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Length: 25
Date of creation: Feb 2013
Date of revision:
Handle: RePEc:npf:wpaper:13/118
Note: Working Paper 118, 2013
Contact details of provider: Web page: http://www.nipfp.org.in

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