Does social identity matter in individual alienation? Household-level evidence in post-reform India

Abstract

Does consumption distance as a measure of individual alienation reveal the effect of social identity? Using the central idea of Akerlof's social distance theory, individual distance is calculated from their own group mean (median) consumption and then we examine whether individuals from different social groups-caste and religion-are alienated across the distance distribution. Using India's household-level microdata on consumption expenditure covering three major survey rounds since the inception of the reform period, we find a non-unique pattern in the distance distribution where the marginalised and minority group households tend to be alienated across the distribution. However, among them, the households with higher educational attainment become more integrated as reflected in the interaction effect of education. These results are robust even after controlling for the endogeneity of education. Given this significant group difference in consumption, we undertake a group-level comparison by creating a counterfactual group through exchanging the characteristics of the priviledged group to the marginalised group (or Hindus to non-Hindus), and find that the privileged group still consumes more than the counterfactual marginalised group, explaining around 77% of the estimated average consumption gap at the median quantile in 2011-12 (or 59% for Hindus versus Non-Hindus). This suggests other inherent identity-specific social factors as possible contributors to within-group alienation (relative to a better-off category) that can only be minimised through promoting education for marginalised (or minority religion) groups.

Education, social identity and self-employment over time: evidence from a developing country

“…The institutional profile associated with the caste system may not support individuals from backward classes becoming self-employed (Audretsch et al, 2013), and may limit access to finance and information (Bönte & Filipiak, 2012). Gupta et al (2018), amongst others, study the extent caste systems impacts individuals' social identity and their consumption levels. Many authors also note that it is a major obstacle to achieving development goals because affected populations can get excluded from the development process.…”

“…Using social distance theory, Gupta et al (2018) argue that social identity plays a role in individual alienation. However, it is well-known that the years after liberalization in early nineties have unleashed many economic opportunities in the Indian economy, and there are compelling reasons to assume that the dynamic economic environment is influencing the occupational behaviour of people.…”

Conditional time-dependent nonparametric estimators with an application to healthcare production function

“…Public and private investment affect the mechanism of social cohesion, which interrelates with countries' path of economic development [13]. Such investment policies are favoured by countries since they are the principal transmission channel through which countries' fiscal and financial development policies affect their productivity levels [7,17].…”

Wage differential between caste groups: Are younger and older cohorts different?

“…Both factors have growth-inhibiting effects and trigger a rise in inequality traps, where a disadvantaged group faces a long-run opportunity set worse than that of another group, even though a better set would be possible (Bourguignon et al, 2007). Undoubtedly, discrimination, prevalent in the form of either caste, gender, or skin colour can lead to inefficient sub-optimal outcomes (Esteve-Volart, 2009); increases social inequality which in effect can also lead to social alienation in the society (Gupta et al, 2018).…”