Historical Inequality at the Grassroots: Local Public Goods in an Indian District, 1905–2011

• Published date: 01 October 2023
• DOI: http://doi.org/10.1177/00104140231152767
• Author: Alexander Lee
• Date: 01 October 2023
• Subject Matter: Articles

Article

Comparative Political Studies

2023, Vol. 56(12) 1824–1857

© The Author(s) 2023

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DOI: 10.1177/00104140231152767

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Historical Inequality at

the Grassroots: Local

Public Goods in an Indian

District, 1905–2011

Alexander Lee

1,†



Abstract

How do historical inequalities inf‌luence modern public goods provision? This

paper analyses a new panel dataset of local public goods provision in a single

North Indian district with observations at the village-decade level going back

to 1905 and detailed information on colonial land tenure institutions and

demographics. The presence of large colonial landowners is positively as-

sociated with rural public goods provision when the landlord was resident in

the early 20th century and has a null effect when the landlord was an absentee.

Villages inhabited or owned by upper castes had an advantage in the colonial

and immediate post-independence eras, but not afterward. The results

suggest that within unequal societies, economic and status inequalities can

have positive effects on public goods provision when they link elites to

extralocal decision-makers.

Keywords

historical legacies, state capacity, public goods

1

University of Rochester, Rochester, NY, USA

†

Thanks to Ha Nguyen, Bill Kte’pi, Prambod Manohar, Melanie Wu, Philippe Maas, Natasha Abrol

and especially JB Venkatesh for excellent research assistance and Jack Paine, Anderson Frey,

Gretchen Helmke and attendees at the Southern and American Political Science Associations’

annual meetings for comments. Replication data are available at the CPS dataverse https://doi.

org/10.7910/DVN/VSRNFS

Corresponding Author:

Alexander Lee, University of Rochester, Harkness Hall, Rochester, NY 14627, USA.

Email: alexander.mark.lee@rochester.edu

Introduction

In the past two decades, there has been an explosion of literature on the long-

term effects of historical institutions on economic development and public

goods provision (Acemoglu et al., 2002;Dasgupta, 2018;Dell, 2010;Iyer,

2010;Sellars & Alix-Garcia, 2018;Sokoloff & Engerman, 2000). Much of

this literature focuses on the causes of persistent institutional arrangements

that raise levels of economic inequality or empower elite groups. Critical

junctures, in this formulation, are critical because they determine the amount

of social power the elite can wield. These historical arguments are important

because a common claim in the literature on the political economy of public

goods provision is that higher levels of social inequality, or the presence of

institutions that strengthen inequality and social groups that benef‌it from it, are

associated with lower levels of public goods provision (Acemoglu et al., 2014;

Anderson et al., 2015;Baldwin & Huber, 2010;Mattingly, 2016;Shami,

2012;Suryanarayan, 2017). Such inequalities are thought to weaken the

potential for local collective action and redistributive taxation to fund public

goods provision. Why should elites pay a disproportionate share of costs to

fund public goods that may in the long run undermine their social position?

There is, however, an alternative theoretical logic. While powerful local

elites may undermine local collective action, they may be in a stronger

position than the poor to lobby with extralocal elites to fund public goods in

their area and may also have suff‌icient private investments in their community

to overcome incentives to free ride (Olson, 1971). If this lobbying effect

dominates the collective action effect, more inequality in status and land

would be associated with higher levels of public goods provision at the local

level, though not necessarily at the social level (Baldwin, 2019;Dell, 2010;

Kustov & Pardelli, 2018;Lee, 2018). This effect should be most apparent in

the communities where elites actually live, and where they can thus personally

benef‌it from goods that improve human capital and from the prestige rents that

accrue to successful community advocates (Tsai, 2007).

The ability of the persistence literature to test this alternative logic is

limited by two analytical shortcuts. Firstly, the unit of analysis is often distinct

from the unit of treatment, either because of change in the structure of units

over time or the unavailability of disaggregated data; processes that occur at

the local or even individual level are measured either at the state or district

levels (Banerjee & Iyer, 2005;Banerjee & Somanathan, 2007;Chaudhary,

2009;Iversen et al., 2013;Lee, 2019b). Results may vary widely based on the

level of aggregation, particularly when the units of aggregation themselves are

correlated with preexisting geographical conditions and subsequent historical

events. Secondly, measurements of the outcome of interest may not be

available for a long part of the period between the historical treatment and the

present day, making it impossible to assess changes in effect size over time. In

Lee 1825

fact, perhaps the most common design is cross-sectional, with only suggestive

evidence of whether or how an institution’s effect persisted over the decades

(or, sometimes, millennia) between treatment and measurement.

Given its deep-seated social and economic inequalities, India has seen

studies of both public goods provision and historical institutions. For instance,

in some areas, the colonial state transferred land tenure rights to a few large

landlords; a policy thought to be associated with lower levels of local public

goods provision and agricultural investment (Banerjee & Iyer, 2005).

1

The

“ranked”social differences characteristic of the caste system are also widely

thought important in shaping political patterns (Anderson et al., 2015;

Banerjee & Somanathan, 2007;Chaudhary, 2009;Suryanarayan, 2017;

Waring & Bell, 2013) with status inequality associated with local levels of

public goods provision.

This paper analyses a new dataset of public goods outcomes and historical

institutions in a single district in the North Indian state of Uttar Pradesh (UP),

Agra. The unit of measurement is the village-year, the basic level at which

public goods are assigned. For many villages, it includes detailed information

on the structure of landholding in the late colonial era, collected from un-

published colonial records from the local archives. These are supplemented

with colonial census data, which gives detailed information of local caste and

occupational breakdowns in the late colonial period. These data on local

conditions supplement panel data on the provision of local public goods in

each village that was collected (roughly) every decade from 1905 to 2011. The

data is thus complementary to studies focused on individual villages over time

such as Lanjouw, Stern (1998) and broader accounts of rural UP’s historical

evolution such as Metcalf (1979).

The data show only very limited support for existing hypotheses about the

effects of historical inequality. Ownership of the village by a single landlord in

colonial times is not associated with lower levels of public goods provision

than more fragmented ownership after conditioning on village population and

location, either today or in any previous historical period, even after con-

ditioning on a wide variety of spatial and environmental traits. In fact, villages

with a single colonial landlord were slightly more likely than other villages to

have high levels of public goods provision in the late 20th century, but only if

the landlord lived in the village. Villages owned by absentees, who had no

incentive to advocate for local public goods provision, are identical to non-

landlord villages, a f‌inding that is reminiscent of older arguments about the

negative effects of absentee landlordism on local social solidarity (Moore,

1966).

The effect of the presence of upper caste groups varies over time. The

presence of upper caste groups, either as a plurality of the population or as a

plurality of landowners, had a positive inf‌luence in the Colonial (1905–1951)

and “Congress”(1951–91) eras, when upper castes were overwhelmingly

1826 Comparative Political Studies 56(12)