A new study found that India’s commodities boom could help elect—and enrich—dodgy politicians
by Sam Asher of John Hopkins University and Paul Novosad of Dartmouth College suggests that these goals might be at odds with each other. They find that India’s commodities boom could help elect—and enrich—dodgy politicians.A daily email with the best of our journalismMessrs Asher and Novosad studied how price shocks across 31 different minerals related to the electability and behaviour of winners in 948 local elections in resource-rich constituencies between 2003 and 2017.
The study revealed that a doubling of mineral prices over five years before an election increased the likelihood of a politician who is facing criminal charges being elected by 11.4% . Price booms especially favoured those facing charges of serious violent crime, such as “actual or attempted assault, armed robbery, homicide, kidnapping or sexual assault”. Those alleged criminals were 12.3% more likely to be elected, while candidates facing corruption-related charges were 3.
Good fortune also follows the politicians once they assume office. Sitting lawmakers enjoy a 28% increase in asset wealth —but are twice as likely to face new criminal charges—when the prices of minerals in their constituency double during their term. The effect is true for price shocks in coal and iron, which account for 75% of the mineral output sampled, as well as for more minor commodities such as tungsten.
Mining is ripe for rent-seeking. The industry is poorly regulated, with mining rights caught in a web of state-owned enterprises, private firms and government agencies. Commodities sparkle with the allure of sudden wealth. Even rich countries can fall victim to the “political resource curse”: the phenomenon of corruption increasing in line with natural resources.
The study is based on public records of criminal charges and assets, which the authors note may not capture the full extent of criminality or wealth. And correlation between global mineral prices and local political behaviour does not necessarily show causation. The authors leave out the role of regional parties, the mainstay of many states’ politics, from their analysis . Still, the findings offer plenty to chew over. Mineral prices are set to soar this year as global demand rekindles.
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