What accounts for the large and ever-changing number of political parties that contest Indian state elections? In this paper we examine this question by testing an equilibrium model of political party numbers where the number of parties depend on the average size of state constituencies, voter turnout, the heterogeneity of the state’s electorate, constitutional and legislative rules that directly affect party numbers and per capita state incomes while controlling for a series of discrete political events that have influenced political parties. The analysis compares this model with one explaining the effective number of parties (ENP) and extends the analysis to consider the effect of political factors such as the openness and competitiveness of the upcoming election on the timing of the decision of political parties to enter and exit (and thus the rate of political party turnover). The analysis is further extended by allowing the level of development to interact with their party structures.

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Keywords number of political parties, Indian states, entry and exit of political parties, ENP, fixed effects poisson panel estimation
JEL Economic Models of Political Processes: Rent-Seeking, Elections, Legislatures, and Voting Behavior (jel D72), Bureaucracy; Administrative Processes in Public Organizations; Corruption (jel D73), Political Economy (jel P16), State and Local Government; Intergovernmental Relations: General (jel H70)
Publisher Carleton University
Series Carleton Economics Working Papers (CEWP)
Ferris, J.S, & Dash, Bharatee Bhusana. (2020). On the Structure of the Political Party System in Indian States, 1957-2013. Carleton Economics Working Papers (CEWP). Carleton University.