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Religious Identity and the Provision of Public Goods: Evidence from the Indian Princely States

Latika Chaudhary and Jared Rubin ()

Working Papers from Chapman University, Economic Science Institute

Abstract: Religious identity affects preferences and can consequently affect policy. We propose two mechanisms through which a ruler's religious identity can affect public good provision: i) greater provision of goods in regions where more subjects are the ruler's co-religionists, and ii) lower provision of goods where private markets provide a substitute to the ruler's co-religionists. Empirically, identifying the causal effect of religious identity on policy is often impossible, since the religious identity of rulers rarely changes over time and place. We address this problem by exploiting the variation in the religion of rulers in the Indian Princely States in the early 20th century. The Indian Princely States had significant variation in the religion of the ruler (primarily Hindu and Muslim), often due to unique historical experiences. Using data from the 1911 census, we fin d that Muslim-ruled states had lower Hindu literacy but the religion of the ruler had no statistically significant impact on Muslim literacy, railroad ownership or post office provision. These results support the idea that rulers provide less public goods when religious institutions provide a substitute targeted at their co-religionists, but there is only weak evidence that rulers provide more public goods when more subjects share their religious identity.

Keywords: identity; public goods; religion; Islam; Hinduism; literacy; India; Princely States (search for similar items in EconPapers)
JEL-codes: H30 H41 H42 H52 H72 I28 N35 N45 N75 Z10 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2013
New Economics Papers: this item is included in nep-his and nep-pbe
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Journal Article: Religious identity and the provision of public goods: Evidence from the Indian Princely States (2016) Downloads
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