United on Divisive Waters: Decentralization of Irrigation and Conflict in India

Arguments for decentralization of local public goods often rely on potential productivity gains. However, such reforms may also affect social cohesion, especially in diverse communities. Focusing on the irrigation decentralization experience of India, we study this issue in a staggered difference-in-difference framework exploiting variations across space and time. We find that decentralization of irrigation lowers incidence of riots, and this effect is observed in places with both homogeneous and more diverse population. Our mechanism analysis points at improvements in cooperation patterns with decentralization of irrigation increasing access to irrigation and agricultural yields.