My book project titled Hollowing out the State — Franchise Expansion and Fiscal Capacity in Colonial India and 19th Century American South, examines the conditions under which elites build and maintain robust tax institutions. Studies of fiscal capacity have typically emphasized historical factors such as war-making and colonialism to explain variations in tax institutions. The cooperation of political elites in investing in fiscal institutions is implicit in these studies. My book argues that in some contexts political elites may weaken fiscal capacity in anticipation of new groups coming to power. Why does this happen? In societies with hierarchical social orders, such as the caste system in India or slavery in the United States, incumbent elites are able to use the threat of de-segregation and a social-status cleavage to form anti-tax coalitions.
In the first empirical chapter, currently under review, I demonstrate that incumbent political elites in colonial Indian provinces hollowed out tax capacity in anticipation of a franchise expansion. Through 13-months of archival work in London, Chicago, Delhi, Chennai and Madurai, I built a dataset spanning 43 districts between 1914-1925 in the Bombay and Madras provinces. I used Colonial era records to develop novel micro-level measures of land tax collection, tax avoidance, and the size of the tax bureaucracy. I find that fiscal capacity declined after franchise expansion in the districts with higher levels of inter-caste status inequality. Importantly, status-inequality between castes rather than land inequality or ethnic fragmentation explained the decline in tax institutions. This suggests that class or ethnic cleavages alone are not sufficient to create the conditions for a weakening of tax capacity.
In the second empirical chapter, co-authored with an American Political Development scholar, Steven White (Syracuse University), I test the external validity of my argument beyond the Indian case. We examine the historical legacies of slavery and Reconstruction on fiscal capacity at the county-level in the American South. In order to measure bureaucratic capacity, we use census data from 1860-1880 to develop county-level measures of tax collection and age-heaping. We find that the end of the Civil War was associated with an increase in taxation and better bureaucratic quality under an occupying North in counties where there were greater numbers of emancipated former slaves. However, after Reconstruction ended, the same counties were more likely to see a weakening of fiscal capacity as white “Redeemers” attempted to roll back institutional changes. Importantly, the chapter shows that counties where fiscal weakening occurred after Reconstruction are also those with weaker tax institutions in the present day.
In a stand-alone paper, currently at a revise and resubmit stage, I examine the phenomenon of right-wing voting amongst the poor. I demonstrate that an announcement in the Indian parliament to implement affirmative action to lower castes in 1990 was followed by a rise in right-wing voting for the Bharatiya Janata Party. Using state electoral constituency-level data from the 1931 census, this paper shows that constituencies where upper castes were more dominant in the 1930s experienced a higher surge in right-wing voting after this announcement than other areas.The paper provides further evidence for the claim that cross-class solidarities emerge in support of anti-redistribution parties in places where the status dominance of groups is threatened.