The Political Economy of Elite Dominance and Ethnic

Despite more than four decades of planning efforts with an emphasis on balanced regional development, inter- and intra-state disparities in key indicators of quality of life in India are striking. Using Indian state- level data for the period 1960-92, the present paper examines the nature of political economy of elite dominance and ethnic heterogeneity, both of which could in principle be responsibel for lower the provision of public services. Fixed–effects panel data estimates seem to confirm that (a) greater degree of elite dominance lowers the spending on education (but not that on health) while greater degree of ethnic heterogeneity lowers spending on both health and education. (b) Also, predominance of Indian National Congress regime has been higher in states with greater dominance of elite upper class and ethnic heterogeneity. Thus there is a close correspondence between political regimes and social development spending in the sample states though there is a clear lack of convergence in state spending on health and education suggesting the divergent agenda of the state governments in India.