Diversity Debit Hypothesis
15 December 2018 – 15 May 2019
This project comprises of two papers. The first one presents evidence to challenge one of the most important hypothesis in political economy – the negative relationship between diversity and public goods provisioning. Using the largest ever dataset (nearly 0.6 million villages form Indian national census 1991, 2001, and 2011), we provide empirical support for three central claims that we make in this paper. First, we show why the ethnic diversity-public goods relationship is highly sensitive to geographic unit of analysis. Second, we control for spatial structure of ethnic distributions and identify it as a key missing variable in extent literature. Third, we show how the theoretical ambiguity in ethnic politics of public goods is partly related to the nature of public goods. Beyond explicating the problems with extant evidence, we expound a number of hypotheses to explain the positive correlation between diversity and publics goods at the village-level. The second paper provides a novel theoretical framework to describe the ethnic politics of public goods provisioning in nested subnational units. Our framework is the first to simultaneously account for ethnic diversity, ethnic geography, and ethnic histories. We also formally define the public goods catchment area and delineate its centrality in determining how ethnic geography and ethnic hierarchy modulate the role of diversity – especially in a stratified society, and when decentralization is incomplete. We show why the combined effect of diversity, spatial segregation, and historical hierarchies makes the ethnic politics of public goods provisioning theoretically ambiguous. Our findings are thus a call for reconsidering extant empirical evidence that is aspatial, atemporal, or both.
I am an Assistant Professor of Economics at the Institute for Financial Management and Research, Sri City (currently on leave). I received my PhD in Development Studies, and M.Sc. in Economics from Indira Gandhi Institute of Development Research, Mumbai. I hold a B.A. in Economics, Geography, and English Literature from the University of Allahabad, Allahabad. My research interests are: political economy, development economics.
My thesis looked into the issue of regional imbalances in Maharashtra. My current research focuses on examining how geography and state capacity affect the relationship between social divisions and economic development in India. I am also working on the issue of structural transformation in India.