Those who can't sort, steal: Caste, occupational mobility, and rent-seeking in rural India

Article Type

Research Article

Publication Title

Journal of Demographic Economics

Abstract

Three important features of Indian labor markets enduringly coexist: rent-seeking, occupational immobility, and caste. These facts are puzzling, given theories that predict static, equilibrium social inequality without conflict. Our model explains these facts as an equilibrium outcome. Some people switch caste-associated occupations for an easier source of rents, rather than for productivity. This undermines trust between castes and shuts down occupational mobility, which further encourages rent-seeking due to an inability of workers to sort into occupations. We motivate our contribution with novel stylized facts exploiting a unique survey question on casteism in India, which we show is associated with rent-seeking.

First Page

107

Last Page

140

DOI

10.1017/dem.2020.21

Publication Date

3-1-2021

Comments

Open Access, Green

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