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Why Does the Indian State Both Fail and Succeed?
Abstract
The Indian state’s performance spans the spectrum from woefully inadequate, especially in core public goods provision, to surprisingly impressive in successfully managing complex tasks and on a massive scale. It has delivered better on macroeconomic rather than microeconomic outcomes, where delivery is episodic with inbuilt exit than where delivery and accountability are quotidian and more reliant on state capacity at local levels, and on those goods and services where societal norms on hierarchy and status matter less than where they are resilient. The paper highlights three reasons for these outcomes: under-resourced local governments, the long-term effects of India’s “precocious” democracy, and the persistence of social cleavage. However, claims that India’s state is bloated in size and submerged in patronage have weak basis. The paper concludes by highlighting a reversal of past trends in that state capacity is improving at the micro level even as India’s macro performance has become more worrisome.
... Many authors have written about the limited state capacity of India. The Indian state is inadequate in some matters but does well in other contexts (Kapur, 2020). Further, India copies the West in its many rules and regulations but has a very limited capacity to implement the policies resulting in further breakdown of capacity (Rajagopalan and Tabarrok, 2019). ...
... When "managing complex tasks and on a massive scale" and where there is an exit, like national elections, the Indian state does well in 'mission mode' (Kapur, 2020). However, this was not true with the episodic event of demonetization. ...
... India's local government employment is very low when compared to countries like China and the U.S. Only 3% of total government expenditure is at the local level compared with 27% for the US and 51% in China (Kapur, 2020). Local governments, as frontline bureaucracy, need independent financing and need to be much larger to implement programs such as basic sanitation and waste management effectively (Randolph and Gandhi, 2020), but these powers need to be devolved from the state level (Rajagopalan, 2018). ...
The paper will look at the initial Indian government’s response to COVID-19 focusing event. The strategy used to tackle the issue in India was copied from resource-rich countries and authoritarian countries. Instead, the prime minister should have used local and institutional knowledge, considered India’s institutions, culture, and state capacity, for a “Make in India” response that would be more suitable for India. Policy actions are proposed considering previous epidemic responses including decentralization decision-making process, incentivizing civil society, etc. These solutions could also be used to deal with future national problems as they arise with a focus on saving lives and livelihoods.
... In contrast to the unified account, a representative of an NGO opined that "the immediate response (in 2018) was more like a knee jerk reaction, though coming from a well meaning and well endowed and knowledgeable government but it was not a reaction that comes from planning and drills" (KI.1, male, 40s). As elaborated by Kapur (2020), these episodic actions are less beneficial for addressing long-term uncertainty wherein decision-making is more complex such as in the second case. The landslides which occurred as a consequence of the floods in 2019 were thought to be triggered by the excessive quarrying in ecologically sensitive areas in Wayanad. ...
... /frsc. . governing bodies whereas systemic and long-term challenges are less addressed because of the lack of capacity to process the various complexities and the absence of an "unifying" framework to take decisions across governance institutions, mirroring findings regarding bureaucratic decision-making in other similar contexts in India (Kapur, 2020). Table 1 below summarizes the empirical findings and the factors that enabled or hindered individual and collective actions in Wayanad that potentially influenced DMUU and the intra-case shifts in individual and collective action under short-and longterm uncertainty. ...
An increase in unprecedented environmental crises as a result of climate change and human influence has amplified calls for recognizing the complexity of decision-making under uncertainty (DMUU). How decision-makers act in institutional settings under uncertainty has, however, received limited attention in decision-making in planning practice. This article investigates DMUU in the context of Wayanad, a peri urban hill district in Kerala, India through two decision settings; the response to unprecedented heavy monsoon floods in 2018 and 2019 as a case of short-term uncertainty, and policy and plan making regarding quarrying in ecologically sensitive areas as a case of long-term uncertainty. Through empirical findings from semi-structured interviews of 58 decision-makers from state and non-state actors, the article discusses individual and collective actions made before, during and after the floods by combining insights on DMUU from spatial planning and governance literature underpinned by spatial-temporal and political ecology narratives. The article argues that factors such as community resourcefulness and decentralized governance appeared to facilitate effective decision-making under short-term uncertainty. However, the same factors did not have an intrinsic influence on decision-making under long-term uncertainty with current ways of decision-making regarding quarrying in ecologically sensitive areas likely obstructing sustainable long-term planning and land use transformation in Wayanad. The article concludes with recommendations for potential improvements in decision-making under long-term uncertainty in contexts with weak institutional mechanisms, chronic vulnerabilities and resource scarcity, through structural organizational change, cross-sectoral decision-making arenas, and decision-making frameworks that foregrounds heuristic, flexible, incremental, and cumulative actions across scales over time.
... Civil society and non-governmental organizations added to this effort, working around the clock to provide relief, and academics and researchers mobilized to better understand the crisis and provide timely advice to policymakers. While the ability of the state to function at very high levels for a short period of time or in a specific geographical area has been remarked on, the Covid-19 response in many countries showed that the state can function at this high level for a sustained period and over a wide geographical area [1]. ...
... To date, models have not been able to incorporate human behaviour such as varying levels of compliance to physical distancing policies-which in itself responds to the overall environment. 1 As quickly as 'flattening-the-curve' took hold, without incorporating standard errors on how uncertain the actual response impact was, the estimated response from policies, such as lockdowns, was always a lot more uncertain than what the graphs suggested. ...
... Developing urban resilience is not just complex, it is a "wicked" problem-one that defies simple ways out, since what constitutes the issue varies with the perspective of different stakeholders, and any solution based on a narrow standpoint may exacerbate the problem [4,5]. Rather than empowering citizens to help resolve such "wicked problems", India, the largest democracy in the world, like many other democratic countries, is critiqued for being a "weak democracy", i.e., individualist, conflicted, and with elected governments that diminish the role of citizens [6,7]. This is in contrast with "strong democracy", wherein the citizenship is empowered as much as possible as a way of living [6][7][8][9]. ...
... Rather than empowering citizens to help resolve such "wicked problems", India, the largest democracy in the world, like many other democratic countries, is critiqued for being a "weak democracy", i.e., individualist, conflicted, and with elected governments that diminish the role of citizens [6,7]. This is in contrast with "strong democracy", wherein the citizenship is empowered as much as possible as a way of living [6][7][8][9]. ...
India faces extensive challenges of rapid urbanization and deficits in human well-being and environmental sustainability. Democratic governance is expected to strengthen public policies and efforts towards sustainability. This article presents a study in Pune, India, which aimed at exploring perceptions about public participation in urban governance and the potential of high-quality public deliberation to meet deficits. The research reveals disaffection of the public with government decision-making and government-led participation. Further, it shows that people are interested in participating in community life and seek to be partners in civic decision-making, but find themselves unable to do so. The study illustrates that high-quality public deliberations facilitated by an independent third party can provide a satisfactory space of participation, learning, and developing balanced outcomes. Citizens expressed readiness for partnership, third-party facilitation, and support from civic advocacy groups. Challenges with regard to government commitment to deliberative democracy will need to be overcome for a purposeful shift from conventional weak to empowered participation of ordinary citizens in civic decision-making. We anticipate that while institutionalization of high-quality public deliberations may take time, civil society-led public deliberations may help raise community expectations and demand for induced deliberative democracy.
... Over the past few decades, the share of the middle class employed in the government sector has dwindled as the share working for private companies or self-employed has increased 130 (Kapur 2020). In the past, the coveted government job, with its lifetime job security, health insurance and old age pension, easily supported a male breadwinner household model. ...
This dissertation studies two important dimensions of family life in contemporary India, marriage partner selection and female seclusion, using three different data sources: 48 interviews with the middle-class in New Delhi, panel survey data from the India Human Development Survey, and survey data from the Center for the Advanced Study of India Delhi National Capital Region Survey. The first half of this dissertation sheds light on attitudes towards and the processes involved in arranged marriage among the urban middle class. The young people interviewed approach marriage decision-making with marital pragmatism, framing their choices in terms of risks, uncertainties, and costs. Most describe arranged marriage as the safer option due to the support that these relationships receive from parents. Despite a strong preference for arranged marriage, interviews revealed significant hybridization between arranged and self-choice or “love” marriage. Couples in arranged marriages often engaged in courtship during their engagement. Furthermore, new survey data suggests that many families are willing to call off a wedding if the betrothed find themselves to be incompatible during their engagement, revealing the family’s prioritization of choice and compatibility for the couple. The second half of this dissertation examines patterns of female seclusion and attitudes towards women’s careers. Analysis of panel data shows that women from households which became wealthier reported increased restrictions on their physical mobility and greater odds of practicing head-covering or purdah. These findings suggest that the upwardly mobile may be using female seclusion as a way to signal household status. Dual earner professional couples in India challenge male breadwinner norms through their division of labor. Men who married working women mostly report that they were actively searching for an employed wife on the marriage market because of the financial security that a second income could provide. In addition, to some respondents, dual earning was believed to help facilitate a companionate marriage. This dissertation highlights the role of family, economic precarity, risk, and social norms in shaping marriage and family life in India.
... Controlling for its level of democracy and development, India scores poorly on a variety of state metrics, including the size of its bureaucracy, its ability to collect taxes and to provide adequate legal and administrative services ( Kapur 2020). While the state excels in " episodic" activities like conducting elections and carrying out the census, its capacity to implement programs has been weak on account of an understaffed bureaucracy that struggles with absenteeism, weak incentives and corruption ( Pritchett 2009). ...
... ICT investments support sustainable economic development of EU countries, and the government should make it a priority to increase their investments in improving infrastructure and connectivity and developing trainings for the use and development of ICT, as well as to ease access to ICT [35,36]. Of course, the balance should be kept, the government has a supportive role, without undermining the free market principles [37,10]. ...
The purpose of this paper is to identify which economic measures do ICT experts perceive as important for the development of the ICT sector and to explore whether there is a need to introduce special developmental measures depending on the international or domestic market orientation. To gain valuable results, a survey on 112 ICT experts was conducted and, along with descriptive statistics measures, a chi square test and association rules were used in the analysis. The results of the primary research indicate variables that need to be addressed in the development of new policies (primary reduction of bureaucratization, taxation and frequency of legal changes) and obviates the need for introducing separate policies for internationally oriented companies.
... The excessive intervention of the state and the dominance of public sector chocked competition, bred inefficiency, and impeded economic growth; see Bardhan (2016) and Kapur (2020) for a discussion on the role of the state and its effectiveness. The preferential policies, infinite protection and time-consistent fiscal support to SSIs led to moral hazard problem in that they inflicted unintended disincentives for the small firms to expand their scale of operation and reap the economies of scale. ...
This study undertakes a sector-by-sector account of economic growth, historically since the inception of economic planning, and analyses the spatiotemporal patterns of both rural and urban poverty in India. The services sector bypassed the successful completion of industrialization and prematurely emerged as the dominant driver and key lever of economic growth. The supremacy of services sector strengthened the resilience of the economy to the exogenous shocks of weather aberrations affecting agriculture. The regional disparities have tended to increase over time. The study finds support for unconditional divergence, rather than convergence, in the level of per capita real income across states. The cross-sectional and panel data models estimated for a comprehensive set of 24 states—separately for the rural, urban, and combined rural–urban sectors—provide strong support to the poverty-reducing effects of economic growth. The income-elasticity of poverty hovers around − 2 for the number of persons living below the poverty line. The gains of economic growth are distributed unevenly across states and shared asymmetrically between rural and urban sectors. The economy witnessed a mixed picture of decline in rural–urban poverty, rise in regional disparities, and surge in income inequality.
... The abrupt announcement by central executive order of the national lockdown had a similar precedent in the declaration of demonetization in 2016. According to Kapur (2020), although state capacity in India is inadequate to deliver services at the local level, performance is better at time-bound, episodic activities, such as elections and immunization, especially at the higher levels of government. The interaction between the central government and citizens has become associated with somewhat grandiose actions, underpinned by national leaders' mass appeal to citizens, indicating a consolidation of individual authority along with centralization of governance. ...
In response to the rapidly spreading COVID-19 pandemic, governments resorted to containment and closure measures to reduce population mobility and ensure social distancing. Initially, India's state governments enacted varying social-distancing policies until the Central government overrode states to impose a nationwide lockdown on 24th March. This paper examines the relative impact of state- and central-level social-distancing policies on changes in mobility, comparing the periods before and after the national lockdown. A district-level panel dataset is formed, compiling data on social-distancing policies and changes in population mobility patterns. Panel regressions reveal that the incremental effect of each social-distancing policy varied across states in the pre-24th March period. The national lockdown led to much larger, though varying, reductions in mobility across all states. Overall, states which were able to achieve higher compliance in terms of reducing mobility in the pre-lockdown phase performed better in the national lockdown.
Supplementary information:
The online version contains supplementary material available at 10.1057/s41287-021-00463-4.
... Popular discourse continuously harped on the widespread prevalence of institutionalised forms of corruption, favouritism and nepotism among the bureaucrats. In fact, bureaucracy is held to be primarily responsible for India's many policy failures, and is equally credited with some of its successes (Kapur, 2020). ...
This article presents a critical assessment of the new wave of anthropological scholarship on bureaucracy and its relevance in India. Dealing primarily with everyday bureaucratic practices, and their entanglements with local hierarchies of power, status and wealth, such studies underline the contingent and contextual nature of the enterprise of ‘state-making’. Moreover, they direct our attention away from the normative, formal-institutional configurations of state power to the quotidian workings of the state through its materiality and discursive representations at multiple loci of state–citizen interface in post-colonial India that are invariably orchestrated bureaucratically. While bringing out the implications of this change in theoretical, methodological and substantive focus for our understandings of the interrelated ideas of state and citizenship, the article concludes by outlining a few possible trajectories for further scholarly engagement so far as studies of bureaucracy in India are concerned.
... Although the agency-based and political dysfunctionalities of public organizations are well documented (Krueger, 1990;Niskanen, 1971;Shleifer, 1998), even the largest multinational cannot match the size and reach of governments covering large populations and with perceived legitimacy to provide critical public services. In India, Aadhaar, the world's largest biometric identification program, benefitted from the personal contribution of Nandan Nilekani, cofounder of Infosys, but was essentially a government-led initiative (Kapur, 2020). In Brazil, a significant reduction in inequality was accomplished via wage policies and government transfer programs (Khanna, 2018;Wong, 2015); and its public health system, although far from ideal, has provided broad coverage and inclusion of poor populations (Couttolenc, Gragnolati, & Lindelow, 2013). ...
... This is especially, but not exclusively, true of developing countries, which tend to have much smaller public sectors (Besley and Persson 2014). This is the case with India, the focus of this study, which is characterized by rampant under-staffing and vacancies across its frontline bureaucracy (Kapur 2020). ...
Government programs often fail on the ground because of poor implementation by local bureaucrats. Prominent explanations for poor implementation emphasize bureaucratic rent-seeking and capture. This article documents a different pathology that we term bureaucratic overload : local bureaucrats are often heavily under-resourced relative to their responsibilities. We advance a two-step theory explaining why bureaucratic overload is detrimental to implementation as well as why politicians under-invest in local bureaucracy, emphasizing a lack of electoral incentives. Drawing on a nationwide survey of local rural development officials across India, including time-usage diaries that measure their daily behavior, we provide quantitative evidence that (i) officials with fewer resources are worse at implementing rural development programs, plausibly because they are unable to allocate enough time to managerial tasks and (ii) fewer resources are provided in administrative units where political responsibility for implementation is less clear. The findings shed light on the political economy and bureaucratic behavior underpinning weak local state capacity.
The paper will look at the initial and subsequent Indian government’s response to the COVID-19 focusing event. The strategy used to tackle the initial Covid-19 wave in India was copied from resource-rich countries and authoritarian countries and due to centralization bias in India’s institutions, a monocentric response to the crisis was the default instead of cooperative solutions. However, the response to the pandemic should have been by multiple decision centers and based on local and institutional knowledge, considering India’s institutions, culture, and state capacity, for a “Make-in-India” polycentric response. Solving large-scale health externalities requires coproduction to deal with nested externalities more effectively instead of monocentric global responses. I propose policy considering previous epidemic responses focusing on polycentric governance where civil society is incentivized.
The long durée narrative of the state in independent India is one of accumulation of incremental and aggregate power relations arrayed in and through political institutions inhabiting a field of power. These relationships are protean, exhibiting conflicts and contestations among institutions that compete for power within the domain of the state. The ‘ebbs’ and ‘flows’ in power are visible in the state-space represented by institutional arrangements and the patterns of relationship among them. While institutions perform the function of legitimation for the state, they also manifest the crisis that besets the state, reflecting dissonance between its moral–political goals of bringing about socio-economic transformation and its ability to achieve them through ‘state-bureaucratic’ practices. The constitutional state in India can be seen as the setting where the state-idea as limited by law and as an ‘instrument’ for bringing about transformative change was situated. Institutional crises during the emergency and the uneven trajectories of institutional presence in the ensuing period show the marginalization of institutions such as Parliament and the ambivalence of the judiciary in articulating the principles underlying the constitutional consensus. A dominative presence of the executive corroding deliberative spaces making them sites of adversarial combat and the populist appeal of the ‘leader’ drawing upon communitarian emotions has paved the way for a majoritarian state.
What makes bureaucracy work for the least advantaged? Across the world, countries have adopted policies for universal primary education. Yet, policy implementation is uneven and not well understood. Making Bureaucracy Work investigates when and how public agencies deliver primary education across rural India. Through a multi-level comparative analysis and more than two years of ethnographic field research, Mangla opens the 'black box' of Indian bureaucracy to demonstrate how differences in bureaucratic norms - informal rules that guide public officials and their everyday relations with citizens - generate divergent implementation patterns and outcomes. While some public agencies operate in a legalistic manner and promote compliance with policy rules, others engage in deliberation and encourage flexible problem-solving with local communities, thereby enhancing the quality of education services. This book reveals the complex ways bureaucratic norms interact with socioeconomic inequalities on the ground, illuminating the possibilities and obstacles for bureaucracy to promote inclusive development.
The public debate is rife with polarized views of how to deliver essential services such as education, health, and security. While some tout privatization as a way to supplant bad governments, others warn that private firms maximize profits at the expense of socially oriented service attributes. In reality, all forms of service delivery—public, private and hybrid public private-collaborations—have merits and flaws. This book scrutinizes the menu of delivery forms in public services and the conditions that should make them work. It argues that privatization benefits from capable government units committing to well-defined policy objectives, mobilizing critical resources, and incentivizing effective and inclusive delivery. Societies counting on capable governments can also reject single solutions and experiment with plural paths of improvement, where public and private organizations co-exist and learn from each other. This book will appeal to students, academics, managers and policy makers interested in examining the public-private boundary and the many ramifications of this focal issue.
Most states lack the ability to maintain a uniform presence at the local level. While in some places, citizens experience an attentive and present state that is quick to address their demands, in other parts, the same state can be unresponsive and absent. The unevenness in state presence shapes its capacity to delivery services and its legitimacy in the eyes of the citizens. What explains the spatial unevenness in local state presence? This paper argues that the transfer preferences of mid-level bureaucrats are an important determinant of local state presence. Using a mixed-methods approach that combines insights from qualitative fieldwork and a unique dataset on the transfers history of mid-level bureaucrats in Indian land bureaucracy, I show that bureaucrats have strong transfer preferences and regularly lobby to avoid being placed in jurisdictions further away from their homes or being relocated over long distances. Jurisdictions less preferred by bureaucrats are more likely to experience state absence at the local level. Further, spatial disparities in local state absence are concentrated according to historical patterns of development across different regions of the state; historically less developed regions with lower bureaucratic representation within the state and experience a more prolonged duration of bureaucratic absence on account of bureaucratic lobbying against transfer directives. This paper highlights the importance of transfer preferences of individual bureaucrats and their collective representation in shaping the quality of local governance.
Gender-targeted police reforms are frequently proposed to tackle the global problem of rising yet under-reported gender-based violence (GBV)—but with mixed and often disappointing results. We explore this issue in India, a country with alarming rates of GBV and limited police capacity, by studying the impact of Women’s Help Desks (WHDs): dedicated spaces for women in local police stations, staffed by trained officers. Drawing on the largest randomized controlled trial of a police reform to date (180 police stations serving 23.4 million people), we find that officers in stations with WHDs are more likely to register cases of GBV, particularly where female officers run the desks. This suggests that even in resource-constrained and patriarchal environments, police responsiveness can be improved by focusing and mainstreaming attention to women’s cases and by greater gender representation within the police.
This review of Madhav Kkhosla’s book, India’s Founding Moment, sees his approach as one of “best lights” understandings, that is, an effort to identify and explain the conceptual underpinnings of India’s founding constitution in their best lights. Khosla emphasizes as key the ways in which the constitution’s requirements of full adult suffrage, its intense specificity of language, and its strongly centralized government form, all contribute conceptually to the creation of the democratic citizen of India—a citizen whose rights across the country were secured by a common constitution and central government, whose knowledge of and ability to exercise rights were enhanced by the constitution’s codified approach, and a citizen whose capacities to participate in democratic processes would be developed by the exercise of democratic rights. The review focuses attention on choices about suffrage, comparing India’s with the less inclusionary founding impulses of the United States constitution. It explores nuances of how codification would and would not promote exercises of citizenship rights, noting the importance of adjudication in the construction of the “common knowledge” to which (according to Khosla) the founders aspired. And the review argues that today, as more illiberal, authoritarian regimes are on the rise, the book’s emphasis on the importance of ideas, words, and common knowledge in constructing liberal, democratic politics is of urgent contemporary importance.
Using World Bank (2020), this paper estimates microeconomic utility-based elasticity measure of poverty-loss and provides better understanding of the distress of poverty and possible policy directions in rural and urban areas for India and the People’s Republic of China (PRC). This paper deviates from the conventional use of overly simple head counting. Utility-based welfare point elasticity estimates show substantial welfare gains for both countries, dominated by growth contributing 90%, relative to inequality reductions contributing 10%. Rural India deviates, showing a welfare gain with balanced growth-inequality promotion. Subsequent poverty-loss estimates show potentially declining disutility of poverty in both countries and sectors, with reducing inequality contributing 70%, relative to growth’s 30%. The elasticity estimates presented here show that reducing rural and urban inequality can best reduce the distress of the poor. By realigning priorities from promoting future urban growth to reducing urban and rural inequality can lead to substantial reductions in poverty-induced disutility.
Exposure to air pollution from cooking with solid fuels has important consequences for public health. This paper focuses on rural north India, where despite robust economic growth and government subsidies, the vast majority of households mainly use solid fuels. We draw on new qualitative and quantitative data collected in the context of a policy environment that dramatically expanded ownership of liquid petroleum gas (LPG) to examine why households are slow to adopt clean fuels in rural north India. We find that patriarchal gender norms and attitudes encourage the use of solid fuels in this region. North Indian society confers low status to women, promotes women’s seclusion, and constrains women’s engagement in economic activities outside of the home. These beliefs encourage women to preserve gas, promote women’s work that facilitates the use of solid fuels, and hinder communication between the cook and the decision-maker regarding LPG refills. When rural north Indian households use gas, it is frequently to facilitate the adherence to norms of seclusion that prevent women from leaving the home to collect solid fuels. In addition to expanding access and improving economic conditions, future research and policy interventions should pay careful attention to the gender norms and attitudes that discourage the use of gas. Addressing these beliefs and norms is essential to sustained LPG use and health improvements.
Using official statistics, bureaucratic registers and ethnographic material collected from the implementation of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) from six districts across six Indian states, the article explains under what conditions the capacity of last-mile bureaucracy matters for the performance of pro-poor welfare programmes in the Indian federal polity. In seeking to address the presence of heterogenous welfare outcomes in the districts of India, the article underscores the salience of last-mile bureaucrats and the extent to which the politicization of redistributive struggles might contribute to local state capacity to deliver welfare services, a hitherto under-researched aspect in comparative social development research. Challenging the conventional thesis that only a strong autonomous state succeeds in implementing welfare programmes, the article further argues that effective policy implementation can occur within the peculiar environment of relatively low-capacity last-mile bureaucracies even in the face of adverse socioeconomic circumstances. In short, the article shifts attention to the understudied relationship between the capacity of last-mile bureaucracy and welfare outcomes in India.
Are ostensibly demand-driven public works programs with high levels of safeguards nonetheless susceptible to political influence? We investigate this conjecture using expenditure data at the local level from India’s National Rural Employment Guarantee Scheme. Focusing on one state where accountability and transparency mechanisms have been employed and implementation efforts have been widely applauded, we find no evidence of partisan-influenced spending before the 2009 election and find that the political leaning of a mandal played only a small part in fund distribution after the 2009 election. Most variation in public works expenditures is explained by the observed needs of potential beneficiaries, as the scheme intended.
Background
Limited research on Posting and Transfer (P&T) policies and systems in the public sector health services and the reluctance for an open debate on the issue makes P&T as a black box. Limited research on P&T in India suggests that P&T policies and systems are either non-existent, weak, poorly implemented or characterized by corruption. Hence the current study aimed at opening the “black box” of P&T systems in public sector health services in India by assessing the implementation gaps between P&T policies and their actual implementation. Methods
This was a qualitative study carried out in Department of Health, in a Western State in India. To understand the extant P&T policies, a systems map was first developed with the help of document review and Key Informant (KI) Interviews. Next systems audit was carried out to assess the actual implementation of transfer policies by interviewing Medical Officers (MOs), the group mainly affected by the P&T policies. Job histories were constructed from the interviews to understand transfer processes like frequencies of transfers and to assess if transfer rules were adhered. The analysis is based on a synthesis of document review, 19 in-depth interviews with MOs working with state health department and five in-depth interviews with Key Informants (KIs). Framework analysis approach was used to analyze data using NVIVO. ResultsThe state has a generic transfer guideline applicable to all government officers but there is no specific transfer policy or guideline for government health personnel. The generic transfer guidelines are weakly implemented indicating a significant gap between policy and actual implementation. The formal transfer guidelines are undermined by a parallel system in which desirable posts are attained, retained or sometimes given up by the use of political connections and money. MOs’ experiences of transfers were marked by perceptions of unfairness and irregularities reflected through interviews as well as the job histories. DiscussionThe generic transfer rules and ambiguity in how transfers are treated may explain the discrepancy between policy and implementation leading to systems abuse. This discrepancy could have negative influence on MOs’ morale which could in turn affect distribution of MOs. Where possible, ambiguity in the rules should be avoided and a greater transparency on implementation of the transfer rules is needed. However, it may not be possible to make any significant improvements to P&T policies and how they are implemented until the external pressure that creates parallel systems is greatly reduced in translating HR policy into HR practice. Conclusions
Effective P&T policies and implementation may have important implications for organizational performance and may help to improve Human Resource (HR) policy and HR expertise. Also there is a greater need for transparency on implementation of the rules. However, it may not be possible to make any significant improvements to P&T policies and how they are implemented until the external pressure that creates parallel systems is greatly reduced.
This essay comparatively examines the current urban fiscal crisis in US, Chinese, and Indian cities from the perspective of city power. The urban fiscal crisis in the USA is closely linked to the subprime mortgage crisis of 2008 as municipal governments largely depend on property tax as revenue sources. In China, municipal debt has increased sharply since 2008, not because of the recession, but because of the binge borrowing and overinvestment in infrastructure under the state stimulus programme, which was initiated by the central government to minimize the effects of the global recession on the Chinese economy. In India, cities have been in a perpetual state of fiscal crisis due to the stalled devolution of power from state to municipal governments. The comparison on authority, responsibility, and fiscal autonomy of city governments in the three countries demonstrates that the urban fiscal crisis has to be understood in plural terms, as the various assemblages of city power have given rise to a multitude of urban fiscal crises with different origins and consequences.
This article explores why, quite contrary to what dominant theories of corruption predict, bigger governments tend to be less corrupt than smaller ones. The findings?derived from the combination of an in-depth interview study conducted in Uganda, a cross-country, quantitative analysis, and an illustrative case study of a prominent political scandal in Sweden?reveal the important role of taxation in explaining this puzzle. Where citizens pay few direct taxes, they are less likely to feel a sense of “ownership” of the state and are thus also less likely to punish corrupt behavior. In contrast, citizens that are more heavily taxed are likely to keep track of the use of “their” money and are thus also more likely to hold corrupt public officials accountable.
During the nineteenth century, most Western societies extended voting rights, a decision that led to unprecedented redistributive programs. We argue that these political reforms can be viewed as strategic decisions by political elites to prevent widespread social unrest and revolution. Political transition, rather than redistri-bution under existing political institutions, occurs because current transfers do not ensure future transfers, while the extension of the franchise changes the future polit-ical equilibrium and acts as a commitment to redistribution. Our theory also offers a novel explanation for the Kuznets curve, whereby the fall in inequality follows re-distribution due to democratization. We characterize the conditions under which an economy experiences the development path associated with the Kuznets curve, as opposed to two non-democratic paths: an "autocratic disaster", with high inequality and low output, and an "East Asian Miracle", with low inequality and high output.
We investigate whether timing of the elections leads to riots or not within India. In other words, does timing of elections instigate riots? The theoretical underpinning is that an incumbent government and opposition parties exercises control over their agents to instigate communal mob violence and riots during the election years. The motto behind instigating riots is that it leads to polarization of voters and thus benefits the respective constituents (incumbent government & opposition parties). Using time series crosssectional data for 16 major Indian states for the period 1958 – 2004, we find that scheduled elections are associated with increase in riots. Also intensity of riots, proxied by rate of growth rate of riots increases in scheduled election years. We also find that riots and intensity of riots are responsive to the propinquity to an election year. Meaning, as incumbent government nears the elections, riots and intensity of riots keeps increasing, while this is exactly opposite during the early years of incumbent government in office. These results suggest that elections generate “riots cycle” in regionally, ethnically, culturally and socially diverse country like India.
Between 1981 and 2013, the share of the global population living in extreme poverty fell by 34 percentage points. This paper argues that such rapid reductions will become increasingly hard to achieve for two reasons. First, the majority of the poor now live in middle-income countries where the benefits of growth have often been distributed selectively and unequally. Second, a reservoir of extreme poverty remains in low-income countries where growth is erratic and aid often fails to reach the poor. If the international community is to most effectively leverage available resources to end extreme poverty, it must ensure that its investments in institutions and physical infrastructure actually provide the poor the capabilities they need to craft an effective pathway out of poverty. We term the human and social systems that are required to form this pathway “invisible infrastructure” and argue that an effective domestic state is central to building this. By corollary, ending extreme poverty will require both expanding state capacity and giving the poor power to demand reforms they need by solving agency problems between citizens, politicians, and bureaucrats.
Politically-driven corruption is a pervasive challenge for development, but evidence of its welfare effects are scarce. Using data from a major rural road construction programme in India we document political influence in a setting where politicians have no official role in contracting decisions. Exploiting close elections to identify the causal effect of coming to power, we show that the share of contractors whose name matches that of the winning politician increases by 83% (from 4% to 7%) in the term after a close election compared to the term before. Regression discontinuity estimates at the road level show that political interference raises the cost of road construction and increases the likelihood that roads go missing.
Students in India who cheat on a simple laboratory task are more likely to prefer public sector jobs. This paper shows that cheating on this task predicts corrupt behavior by civil servants, implying that it is a meaningful predictor of future corruption. Students who demonstrate pro-social preferences are less likely to prefer government jobs, while outcomes on an explicit game and attitudinal measures to measure corruption do not systematically predict job preferences. A screening process that chooses high-ability applicants would not alter the average propensity for corruption. The findings imply that differential selection into government may contribute, in part, to corruption.
The relative return to strategies that augment inputs versus those that reduce inefficiencies remains a key open question for education policy in low-income countries. Using a new nationally-representative panel dataset of schools across 1297 villages in India, we show that the large public investments in education over the past decade have led to substantial improvements in input-based measures of school quality, but only a modest reduction in inefficiency as measured by teacher absence. In our data, 23.6% of teachers were absent during unannounced school visits, and we estimate that the salary cost of unauthorized teacher absence is $1.5 billion/year. We find two robust correlations in the nationally-representative panel data that corroborate findings from smaller-scale experiments. First, reductions in student-teacher ratios are correlated with increased teacher absence. Second, increases in the frequency of school monitoring are strongly correlated with lower teacher absence. Using these results, we show that reducing inefficiencies by increasing the frequency of monitoring could be over ten times more cost effective at increasing the effective student-teacher ratio than hiring more teachers. Thus, policies that decrease the inefficiency of public education spending are likely to yield substantially higher marginal returns than those that augment inputs.
Governments play a central role in facilitating economic development. Yet while economists have long emphasized the importance of government quality, historically they have paid less attention to the internal workings of the state and the individuals who provide the public services. This chapter reviews a nascent but growing body of field experiments that explores the personnel economics of the state. To place the experimental findings in context, we begin by documenting some stylized facts about how public sector employment differs from that in the private sector. In particular, we show that in most countries throughout the world, public sector employees enjoy a significant wage premium over their private sector counterparts. Moreover, this wage gap is largest among low-income countries, which tends to be precisely where governance issues are most severe. These differences in pay, together with significant information asymmetries within government organizations in low-income countries, provide a prima facie rationale for the emphasis of the recent field experiments on three aspects of the state-employee relationship: selection, incentive structures, and monitoring. We review the findings on all three dimensions and then conclude this survey with directions for future research.
This essay tries to bring out some of the complexities that are overlooked in the usual treatment of the state in the institutional economics literature and supplement the latter with a discussion of some alternative approaches to looking at the possible developmental role of the state. It refers to a broader range of development goals (including the structural transformation of the economy) and focuses on problems like the resolution of coordination failures and collective-action problems, the conflicting issues of commitment and accountability and the need for balancing the trade-offs they generate, some ingredients of state capacity and political coalition building usually missed in the literature, the possible importance of rent sharing in a political equilibrium, the advantages and problems of political centralization and decentralization, and the multidimensionality of state functions that may not be addressed by markets or private firms. ( JEL D72, H11, H77, K00, O17, O43, P26).
Explaining the huge difference in average incomes between the world's richest and poorest nations is one of the most fundamental issues in development economics. How did this vast gulf emerge, and can anything be done to reduce it? To answer these questions, we can seek guidance from three strands of thought. First, there is a long and distinguished line of theorizing that assigns a preeminent role to geography. Geography is the key determinant of climate and of natural resource endowments, and it can also play a fundamental role in the disease burden, transport costs, and extent of diffusion of technology from more advanced areas that societies experience. It therefore exerts a strong influence on agricultural productivity and the quality of human resources. Recent writings by Jared Diamond and Jeffrey Sachs are among the more notable works in this tradition. A second view emphasizes the role of international trade as a driver of productivity change and income growth. We call this the integration view because it gives participation in the larger global economy-and impediments to participation-a starring role in fostering economic convergence between rich and poor regions of the world. The globalization debate, of course, is to a large extent about the merits of this integration view. Finally, a third view centers on institutions-in particular, the role of property rights and the rule of law. In this view, what matters are the rules of the game in a society, as defined by prevailing explicit and implicit behavioral norms and their ability to create appropriate incentives for desirable economic behavior.
"Little else is required to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice; all the rest being brought about by the natural course of things." So wrote Adam Smith a quarter of a millennium ago. Using the tools of modern political economics and combining economic theory with a bird's-eye view of the data, this book reinterprets Smith's pillars of prosperity to explain the existence of development clusters--places that tend to combine effective state institutions, the absence of political violence, and high per-capita incomes. To achieve peace, the authors stress the avoidance of repressive government and civil conflict. Easy taxes, they argue, refers not to low taxes, but a tax system with widespread compliance that collects taxes at a reasonable cost from a broad base, like income. And a tolerable administration of justice is about legal infrastructure that can support the enforcement of contracts and property rights in line with the rule of law. The authors show that countries tend to enjoy all three pillars of prosperity when they have evolved cohesive political institutions that promote common interests, guaranteeing the provision of public goods. In line with much historical research, international conflict has also been an important force behind effective states by fostering common interests. The absence of common interests and/or cohesive political institutions can explain the existence of very different development clusters in fragile states that are plagued by poverty, violence, and weak state capacity.
Theoretical work on disciplining corrupt agents has emphasized the role of expected future rents-for example, efficiency wages. Yet taken seriously this approach implies that illicit future rents should also deter corruption. We study this "golden goose" effect in the context of a statutory wage increase in India's employment guarantee scheme, comparing official microrecords to original household survey data to measure corruption. We estimate large golden goose effects that reduced the total impact of the wage increase on theft by roughly 64 percent. In short, rent expectations matter.
this paper we will be especially concerned with ratings of the performance of the central government bureaucracy. Keefer and Knack (1993) use ratings by the International Country Risk Guide (ICRG) and by Business and Environmental Risk Intelligence (BERI) of "corruption in government" and "bureaucratic delays," respectively; Mauro uses ratings by Business International (BI) of "corruption" and "bureaucracy and red tape;" and Knack and Keefer (1995) and Easterly and Levine (1996) use an ICRG rating of "bureaucratic quality" in their indices of institutional quality. Keefer and Knack find that better performance on both of their variables is positively and significantly associated with growth in per capita income, Mauro finds that better performance on both of his variables is positively and significantly associated with the private investment share of GDP, and Knack and Keefer and Easterly and Levine find positive and 2 significant effects of their institutional quality indices on growth in per capita income. While the cross-country statistical evidence reinforces the idea that differential governmental performance may have an impact on economic growth, it tells us little about what kind of institutional characteristics are associated with lower levels of corruption or red tape. If the findings just listed are meaningful, it is worth identifying which characteristics of government bureaucracies lead to good ratings from the ICRG, BERI, and BI on the variables cited above. This is our aim in the present paper. In a companion paper (Evans and Rauch 1997) we examine the direct impact of bureaucratic structure on economic performance. To achieve this aim required a major data collection effort. Although it is increasingly recognized that without the help of the central gov...
Is China’s public bureaucracy overstaffed? To answer this basic question objectively, one needs to define public employment in the contemporary Chinese context; survey data sources available to measure public employment; and finally, compare China’s public employment size vis-à-vis other countries. Using a variety of new sources, this article performs all three tasks. It also goes further to clarify the variance between bianzhi (formally established posts) and actual staffing size, as well as other permutations of the bianzhi system, especially chaobian (exceeding the bianzhi). A key finding is that China’s net public employment per capita is not as large as often perceived; quite the contrary, China’s public employment size per capita is one-third below the international mean. However, it is clear that the actual number of employees in the party-state bureaucracy has grown – and is still growing – steadily since reforms, despite repeated downsizing campaigns. Such expansion has been heavily concentrated at the sub-provincial levels and among shiye danwei (extra-bureaucracies).
The central question in taxation and development is: "how does a government go from raising around 10% of GDP in taxes to raising around 40%"? This paper looks at the economic and political forces that shape the way that fiscal capacity is created and sustained. As well as reviewing the literature and evidence, it builds an overarching framework to help structure thinking on the topic.
India exhibits a large reliance on target ed transfer payments and subsidies, and significant underprovision of social servic es such as education. These are puzzling outcomes because the poor in India, who vote in large numbers, would benefit most from more of the latter and less of the former. We argue that inadequate social services and excessive targeted transfers can be explained as a consequence of the incomplete information of voters, the lack of credibility of political promises, and social polarization. Disclaimer: The findings, interpretations, and conc lusions expressed in this paper are entirely those of the authors and do not nece ssarily represent the views of the World Bank, its Executive Directors, or the countries they represent . This paper describes research in progress by the authors and is published to elicit comments and to further debate.
We study the wealth accumulation of Indian parliamentarians using public disclosures required of all candidates since 2003. Annual asset growth of winners is on average 3 to 6 percentage points higher than runners-up. By performing a within-constituency comparison where both runner-up and winner run in consecutive elections, and by looking at the subsample of very close elections, we rule out a range of alternative explanations for differential earnings of politicians and a relevant control group. The ``winner's premium" comes from parliamentarians holding positions in the Council of Ministers, with asset returns 13 to 29 percentage points higher than non-winners. The benefit of winning is also concentrated among incumbents, because of low asset growth for incumbent non-winners.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
India's courts have been playing a growing role in the country's political life. Defenders of the judiciary often focus on the few success stories that result from judicial decisions. Yet there is a glaring lack of concrete, empirical data on the effects of court intervention. Courts can proclaim new rights as much as they want, but the proclamation of rights by itself does not produce results. Judges have an important role to play in strengthening our democracy. But they will have to exercise great discretion and resist the intoxication which comes from the view that judges are the last, best hope of the republic.
The paper describes how some irrigation engineers raise vast amounts of illicit revenue from the distribution of water and contracts, and redistribute part to superior officers and politicians. It argues that the corruption ‘system’, which is centred on control of personnel transfers, is an important supply‐side reason for poor performance of canal‐irrigated agriculture. Insofar as the same system operates in other government departments, it may be more important for understanding Indian politics and the political influences on economic development than has previously been realised.
We use data for 436 rural districts from the 2001 Census of India to examine whether different aspects of social divisions help explain the wide variation in access to tap water across rural India. Studies linking social fragmentation to public goods usually aggregate different types of fragmentation into one index. In contrast, we use disaggregated measures of social fragmentation to show that different types of social fragmentation are associated with dramatically different outcomes for access to tap water in rural India. Communities that are heterogeneous in terms of caste (within the majority Hindu religion) have lower access to tap water than correspondingly homogeneous communities. Communities that are fragmented across religions have higher access to tap water than correspondingly homogeneous communities. This underscores the importance of heterogeneity both within and across religions. Therefore, relying on aggregate measures of social fragmentation may conceal different effects of the component measures and obscure important information regarding the design of policies related to public goods.
India poses a development puzzle on a grand scale. Sixty years of electoral democracy, thirty years of rapid growth, and a number of world class institutions (such as the Institutes of Technology or Election Commission) have led to talk of India as a superpower in a league with the United States and China. Yet, on many fronts, India's indicators of human well-being (e.g., malnutrition, immunization) are at, or below, those of much poorer sub-Saharan African countries. Measures of the administrative capacity of the state on basics like attendance, performance, and corruption reveal a potentially "flailing state" whose brilliantly formulated policies are disconnected from realities on the ground. This review essay of Ed Luce's In Spite of the Gods attempts to articulate the puzzle that is modern India and pose questions about the development trajectory of a country whose fortunes will shape our century.
Political principals face high-powered electoral pressures while bureaucrat-agents face longer term, low-powered incentives. Given constitutional constraints, what "carrots and sticks" do politicians employ to control bureaucrats and how do bureaucrats respond to such incentives? We use a simple career concerns framework and a unique dataset from the Indian Administrative Service to address these issues. State level politicians (Chief Ministers) exert control over bureaucrats when they assume office, through a novel mechanism of reassignment (transfers) to new jobs. Transfers are less likely if district politicians belong to the same party as the Chief Minister, i.e. he appears to treat local politicians and bureaucrats as substitutes. We use a framework where bureaucrats differ in their willingness to invest in job expertise or political loyalty. Consistent with this framework, we fi
nd in our data that more able bureaucrats and those with greater job-specifi
c experience are less likely to be reassigned when a new politician assumes office. In accordance with politicians district reassignment patterns, we do not fi
nd robust evidence of any negative impact of such politically-induced transfers on development and policy outcomes at the district level.
We study the relationship between politics and economic growth in a simple model of endogenous growth with distributive conflict
among agents endowed with varying capital/labor shares. We establish several results regarding the factor ownership of the
median individual and the level of taxation, redistribution, and growth. Policies that maximize growth are optimal only for
a government that cares solely about pure “capitalists.” The greater the inequality of wealth and income, the higher the rate
of taxation, and the lower growth. We present empirical results that show that inequality in land and income ownership is
negatively correlated with subsequent economic growth.
We examine the influence of three historically important sources of social divisions on the availability of public goods in rural India: colonial power, landowner-peasant relations as determined by the land tenure system and social fragmentation based on the Hindu caste system and the presence of sizable religious minorities. Using data on public goods from 1991, we find that regions that were under British colonial power in the pre-independence period and those where agrarian power was concentrated in the hands of landlords have lower access to these goods as do areas with high levels of social fragmentation. (JEL: H41, P16) Copyright (c) 2005 The European Economic Association.
The authors try to replace myths about government pay and employment with reliable facts from a survey for about 100 countries in the early 1900s. The study also outlines the general nature of civil service problems in the different regions. Nevertheless, while the facts are useful to"flag"possible problems and initiate a dialogue, recommendations for reform must be based on country-specific analysis. Globally, government employment is negatively associated with wages, and positively with the fiscal deficit (although the availability of financing is more important) and with per capita income (confirming"Wagner's Law"). But the global results stem almost entirely from strong results for Africa and Latin America. Civil service reform has suffered in the past from an overemphasis on retrenchment for fiscal reasons. Its true objective, for each country, is to achieve a civil service of the size and skill-mix, incentives, professional ethos, and accountability needed to provide public goods, help formulate and enforce the rules, and intervene to remedy market failures -as these government roles happen to be defined in the country in question. Civil service reform can begin with various diagnostic and fact-finding activities. The key measures concern rightsizing, incentives, and accountability. These are all relative notions: the right size of the workforce depends on the roles assigned to government; wage adequacy depends on private compensation levels; and strengthening of accountability must define accountability for what and to whom. When retrenchment is warranted, it must be carried out with great care to avoid skill reduction, demoralization, and lower-quality service. Adequate compensation is a must, and wage compression isto be avoided. But performance bonuses, popular in some advanced countries, have been only marginally effective in improving performance in developing countries, even in the private sector. And they can be dangerous in countries with ethnic, clan, or religious conflicts. Finally, improvements in accountability will most often require greater external openness and systematic feedback from service users.
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