Networks, Commitment, and Competence: Caste in Indian Local Politics
This paper widens the scope of the emerging literature on economic networks by assessing the role of caste networks in Indian local politics. We test the hypothesis that these networks can discipline their members to overcome political commitment problems, enabling communities to select their most competent representatives, while at the same time ensuring that they honor the public goods preferences of their constituents. Using detailed data on local public goods at the street level and the characteristics of constituents and their elected representatives at the ward level over multiple terms, and exploiting the random system of reserving local council seats for caste groups, we find that caste discipline results in the election of representatives with superior observed characteristics and the provision of a significantly greater level of public goods. This improvement in political competence occurs without apparently diminishing leaders' responsiveness to the preferences of their constituents, although the constituency is narrowly defined by the sub-caste rather than the electorate as a whole.
We are grateful to Ashley Lester for initial collaboration on this project and to Pedro Dal Bo and Adam McCloskey for many insights that improved this paper. We thank Robin Burgess, Brian Knight, Dilip Mookherjee, Laura Schechter, and numerous conference and workshop participants for helpful comments. Bruno Gasperini provided outstanding research experience. Munshi acknowledges research support from the National Science Foundation through grant SES-0617847. We are responsible for any errors that may remain. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.