APPLIED MICRO: Polity Size And Local Government Performance: Evidence From India; Dr Veda Narasimhan (NYU-Abu Dhabi)

Abstract

Developing countries have increasingly decentralized power to local governments. This paper studies a central element of decentralization – polity size – using populationbased discontinuities that determine local government boundaries for over 100,000 Indian villages. Over the short and long-run, individuals allocated into local governments with smaller populations have better access to public goods. However, this relationship is non-linear, with benefits only observed below certain population thresholds. We provide evidence that these results are explained by greater civic engagement and improved leader selection in those jurisdictions. We find no evidence for other theorized mechanisms such as elite capture.

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