In the last 24 months India has conducted 16 State assembly elections. In five months from now it will conduct a general election. That is, a billion-and-a-half votes being cast in two years. It’s almost as if the Board of Control for Cricket in India (BCCI) has drawn up the schedule — one damn match after the other.

In almost all of these elections we can see one thing clearly: the margins of loss or victory are such that just a few thousand votes in an assembly constituency can make a big difference. In general, the differences in party vote shares are also shrinking.

Lok Sabha elections since 2014 have been different where even the combined vote shares of the non-Congress opposition is less than that of the Congress’s 19 per cent. The BJP’s has been twice that much. But that will change in 2024, perhaps quite dramatically.

Another feature, not visible to the naked eye, is the increasing power of what could be called ‘vote contractors’. These have always been there but only for very large groups. Now the increase in population means that the number of small contractors has grown because each tiny caste sliver has a lot more votes.

If you speak to the more analytical politicians they will tell you that these are nearly entirely based on caste, in fact, jatis. If earlier we had broad varna contracts, now we have sliced and diced jati contracts with a contractor who negotiates.

It’s these smaller contractors who shave the margins. And because of that, they have become extremely powerful. Their bargaining power is now immense.

In other words, earlier there was factionalism in parties. Now there is factionalism within castes, a kind of economy class and premium economy on planes, if you like.

This development of the last ten years has, in a sense, ‘deepened’ our democracy. That’s a good thing. Smaller groups now have some power.

But, simultaneously, as a result of intense pre-election competitive bidding, the costs for all parties have gone up several times. This is not just the financial cost of buying support but also post-election benefaction.

Nor is it just the parties who have a problem. Their main candidates and leaders also have it. They have to cater, shall we say, to a much wider range of appetites for favours and payouts. The consequent balancing has also narrowed the margins.

So for the foreseeable future Indian politics is facing a highly segmented market. It’s like the market for, say, soaps. You can have 100 brands differentiated by small differences in price, smell and packaging.

In each segment there are enough buyers now to make it worthwhile for producers to incur the extra costs of marketing and advertising. And discounting is the name of the game.

You can see this happening in politics, too. The freebie thing is just a manifestation of this. In a sense it’s a simple auction.

Cournot competition

Economics analysed this kind of competition between firms long ago. The French economist Augustin Cournot discussed it all the way back in 1837. It’s called the Cournot model of competition.

The model analyses market conditions in which there is more than one firm (or political parties). All of them are producing the same thing. And, of course, they never cooperate.

They all have some influence on market price which means it’s not a flat price line they face, which would be the case if there was a very large number of producers.

Also, all firms compete on quantities, not prices. Most importantly, they base their policies on their competitors’ output decisions. That is, to modify the Dire Straits song, it’s freebie for freebie and religion for free.

So how does the model resolve itself? Basically, in a duopoly, the firms have nearly equal market shares, corresponding to vote shares between the dominant party and the rest. A two-party State tends to perform better economically than a three or more party one.

Although this outcome looks bad, in terms of representation this is an excellent one for the country. This is particularly true because we have now put off delineation for another decade.

As a result there is just one MP for many multiples of the numbers of people that are there now in a constituency as compared to when it was first established. If an MP represented 100 people in 1980, he or she now represents maybe 8,000-10,000.

The slicing and dicing of castes goes some way in fixing this problem. Maybe caste politics is not such a bad thing after all.

Related Topics
comment COMMENT NOW