Essays on effects of affirmative action: Evidence from job and political reservation policies in India

In this dissertation, I present two essays that empirically investigate two of the worlds largest affirmative action policies currently implemented in India.First, I estimate the effects of world's biggest and arguably most aggressive form of employment based affirmative action policy for minorities that exists in India. This paper exploits the institutional features of federally mandated employment quota policy to examine its effect on labor market outcomes of two distinct minority groups--scheduled castes (SCs) and scheduled tribes (STs). My main finding is that a 1-percent increase in employment quota significantly increases the probability of acquiring a salaried job by 0.9-percentage points for SCs and not the other. Their higher employment resulted in higher household consumption expenditure. Overall, the effects vary within each minority group by education, gender, and geographical location.Second, I estimate the effect of political reservation for minorities on poverty in India. In India, the Constitution stipulates that a certain share of seats in legislative assemblies be set aside for scheduled castes (SCs) and scheduled tribes (STs). According to the policy rule the share of seats reserved for each minority group must equal the group's population share according to the most recent decennial census. In this paper, using state-level panel data, I examine the impact of mandated political representation for minorities on poverty in India. Using data on sixteen Indian states for the period 1960-1992, I find that increasing the share of seats reserved for STs significantly reduces poverty in both urban and rural areas. Increasing the share of seats reserved for SCs significantly reduces urban poverty but has no similar impact on rural poverty. Moreover, the results suggest that people benefiting from political representation are just below the poverty line, not far below it.