Essays on Institutions, Governance and Economic Growth

Abstract

Economic development and growth are impacted by several factors. Among these, existing social institutions, and quality of governance are important determinants. These factors become especially relevant in the context of low and middle-income countries. Such nations are home to a large share of the world’s population, and aspire to grow their economies at high rates. Understanding constraints to their socio-economic development and prescribing policy solutions is, therefore, an important area of research. In the three chapters of this dissertation, I explore three different issues that impact social institutions and governance, which, in turn, impact socio-economic development. I do so in the context of India, which is home to approximately 20% of the world’s total population. In the first chapter, I explore whether historical land policies impact long-run socio-economic outcomes, including the persistent institution of the caste system and stereotypes associated with it. I find that lower land concentration does lead to improved socio-economic outcomes, especially for the socially marginalized landless communities. In the second chapter, I test whether enhanced state capacity by means of better public infrastructure improves the performance ofbureaucrats in rural India. I find that better roads lead to better bureaucratic performance, possibly due to improved monitoring by higher officials whose mobility is positively impacted. Finally, in the third chapter, I examine whether the size of a political party impacts its decisions to field wealthy candidates. I find that a smaller political party is likely to field a wealthier candidate than a bigger political party, possibly due to fewer avenues to mobilize resources. This is important, for the wealth profile of a candidate, in turn, has the potential to impact governance outcomes in their area. The three chapters are aimed at understanding causal relationships pertaining to important questions in the context of India’s society, political economy and economic development. My results provide novel contributions to relevant strands literature, and also allow me to provide relevant policy prescriptions.