Religious Identity and the Provision of Public Goods : Evidence from the Indian Princely States

Identifying the effect of a ruler's religious identity on policy is challenging because religious identity rarely varies over time and place. We address this problem by exploiting quasi-random variation in the religion of rulers in the Indian Princely States. Using data from the 1911 census, we find that Muslim-ruled states had lower Hindu literacy but the religion of the ruler had no statistically significant impact on Muslim literacy, railroad ownership, or post office provision. These results support the hypothesis that rulers provide less public goods when religious institutions provide a substitute targeted at their co-religionists