IIM-Bengaluru and University of Kent study looked at consumption patterns of households in major states before & after elections and found a spike in the expenditure on some key items ahead of the vote.

The money paid as “bribe” to Indian voters is used to drink more liquor, eat more meat and pulses, buy clothes, books and school uniforms, according to a study by researchers from the Indian Institute of Management (IIM)-Bengaluru and the University of Kent in Britain.

Their research paper, titled ‘Cash for Votes: Evidence from India’, also suggests that if there were simultaneous polls for all 4,120 assembly constituencies in India, black money to the tune of Rs 12 lakh crore would go into “vote-buying”.

Cash-for-votes is a known phenomenon in India, as is evident from the seizures of cash and liquor in the run-up to elections and occasional arrests of people for their distribution. In Karnataka, which votes Saturday, seizures worth over Rs 125 crore had been made until Monday.

But these seizures and arrests only indicated the prevalence of this phenomenon; its extent and the end-use could never be estimated for want of information from stakeholders, including politicians and voters.

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In this one-of-a-kind study, three researchers — Anirban Mitra from the University of Kent, and Shabana Mitra and Arnab Mukherji from IIM-Bengaluru — looked at the consumption patterns of households in major states before and after elections to capture the change in expenditures as a result of possible cash transfer by political parties.

They did this by studying data from the National Sample Survey (NSS) rounds on monthly household consumption expenditure during 2004-2012.

The research paper, published last year, was put in public domain recently.

Where the money goes

The researchers studied six categories of consumption that typically account for a large share of a household’s monthly expenditure: Pulses; fish, meat; intoxicants; clothes; health-related expenditure; and education-related expenses.

“Our priority here is that if there is no vote-buying, the timing of election should not matter for patterns in consumption of any commodities,” the researchers wrote.

“Our first significant observation is that household consumption is indeed impacted by elections. This, by itself, suggests that vote-buying is commonplace in India. We find that households tend to spend more on a range of staples, and, to an extent, on ‘intoxicants’. The expenditure on education-related items (books, school uniforms, etc.) shows a significant increase, too,” they added.

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For instance, there is an increase in the consumption of pulses — worth around Rs 50 per capita — for households surveyed close to election dates. Given that the average per capita monthly spending on pulses is around Rs 460, this implies about a 10 per cent increase.

The expenditure patterns for intoxicants — largely driven by local liquor or ‘tharra’ — and clothes such as saris and dhotis show a significant spike in the 20 days before elections. Such spikes eventually disappear as election dates move further and further away.

“Using our estimates, the approximate monetised value of the consumption spikes in a district on average turns out to be Rs 2,900 million (Rs 290 crore),” the researchers wrote.

“This figure, when aggregated over a five-year period (to allow for all states to have elections), comes to around 9 per cent of India’s GDP. These estimates are too substantial to be explained by legal public spending and indicate the presence of the ‘black economy’ in Indian elections,” they added.

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The research paper cites other studies that looked into the issue of election funding. One such study showed that the construction sector faced short-term liquidity crunches during elections, reflected in lower level of activity in building and construction. This lull disappeared post-elections.

Experts acknowledge the prevalence of pre-election giveaways, but say they play little or no role in determining the outcome.

“I will not use the word ‘bribe’ as it will be an insult to the Indian voter,” said Dr Sandeep Shastri, the pro vice-chancellor of Bengaluru’s Jain University.

“I will use the word ‘monetary support’. You have to understand this in the socio-economic context of the society we live in. Voters believe that the monetary support offered by the politicians is actually public money. So there is no harm in having a piece of it. And their voting preference is not influenced by the money they receive,” he added.

Shastri said, however, that if these giveaways were to be stopped, the administration needed to check the “parallel economy”. #KhabarLive

(Video courtesy: The Print)