Business and Politics in India. By Stanley A. Kochanek. (Berkeley: University of California Press, 1974. Pp. 400. $16.50.)

Jaffrelot, Christophe; Kohli, Atul; Murali, Kanta

doi:10.2307/1978480

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Fiscal Structure Of States and Center-state Transfers1

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2009

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“…16 ' 17 This choice of the grant variable is dictated by two considerations. First, category (iii) grants are undoubtedly the most discretionary grants among those listed above.…”

Section: Fiscal Structure Of States and Center-state Transfersmentioning

confidence: 99%

Electoral goals and center-state transfers: A theoretical model and empirical evidence from India

Arulampalam

Dasgupta

Dhillon

et al. 2009

Journal of Development Economics

298

186

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We construct a model of redistributive politics where the central government is opportunistic and uses its discretion to make transfers to state governments on the basis of political considerations. These considerations are the alignment between the incumbent parties at the central and state levels and whether a state is a swing state or not. A testable prediction from the model is that a state that is both swing and aligned with the central government is especially likely to receive higher transfers. We test this prediction using Indian data for 14 states from 1974-75 to 1996-97. We …nd that a state which is both aligned and swing in the last state election is estimated to receive 16% higher transfers than a state which is unaligned and non-swing. JEL Classi…cation: C72, D72

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“…16 ' 17 This choice of the grant variable is dictated by two considerations. First, category (iii) grants are undoubtedly the most discretionary grants among those listed above.…”

Section: Fiscal Structure Of States and Center-state Transfersmentioning

confidence: 99%