Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/180200 
Year of Publication: 
2018
Series/Report no.: 
GLO Discussion Paper No. 227
Publisher: 
Global Labor Organization (GLO), Maastricht
Abstract: 
We estimate the impacts of mandated political reservation for minorities on household credit access and borrowing behavior. To identify causal effects, we exploit the exogenous state-time variation in the allocation of constituencies (electoral districts) to the two reserved minority groups in Indian states. Using a household level panel data with observations before and after the redistricting, we find that the effect is concentrated on the disadvantaged population groups. Political reservation for Scheduled Tribes (STs) increases household probability of getting a loan by 3.7 percentage points, while political reservation for Scheduled Castes (SCs) has no effect on the likelihood of getting a loan. However, conditional on having a loan, reservation for SCs does lead to fewer but larger loans. We also find considerable changes in household borrowing composition.
Subjects: 
Affirmative action
Political reservation
Credit access
Borrowing composition
JEL: 
D78
J15
J78
O12
Document Type: 
Working Paper

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