Co-ethnic Voters and Candidate Choice by Political Parties: Evidence from India

The paper introduces an asymmetric information candidate choice model to examine the inefficiencies arising from co-ethnic political preferences. Unlike past theoretical literature on the topic, political parties in the model internalize co-ethnic political preferences of voters and act strategically. The model predicts that a party’s choice to field a candidate of an ethnicity type depends on the ethnic composition of the constituency’s voters and the ethnicity of other rival candidates running for office. Data from parliamentary and assembly elections from the states of Bihar and Uttar Pradesh in India support the model predictions. Using exogenous changes in information flow proxied by geographical connectedness via all-weather roads, I show that lower information cost or greater connectedness implies a lower level of strategic differentiation of candidates along ethnic lines. Evidence suggests that parties disregard potential candidate’s involvement in crime to be able to differentiate along ethnic lines. As a result, worse candidates get elected to office.