We study the impacts of political affirmative action for historically disadvantaged caste groups in Bihar, India on village social and economic networks. To estimate the causal impacts of the policy, we conduct surveys in communities around the discontinuity in the state government’s policy assignment rule. We find that the marginal constituency assigned to the reservation policy experiences a drop in cross-caste network links and an increase in homophily. Consistent with increased homophily, reservation leads to less social learning when information is introduced to the community. While reservation is active, we find no change in the salience of caste concerns and no shifts in beliefs about trustworthiness, competence, or work ethic, among others, across caste. Finally, consistent with prior work, reservation improves access to redistribution schemes. Both lower and upper castes benefit, indicating no crowd-out at the expense of upper castes.

This talk is presented by the Economic Development Seminar, sponsored in part by the Department of Economics through a generous gift given by Jay and Beth Rakow. This talk is also sponsored by the International Policy Center at the Ford School.