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Abstract
In the literature on the new institutional economics it is now standard to refer to the
deficiencies of the legal and contractual systems and of the regulatory state as blocking
economic progress. In understanding the history of underdevelopment of countries like India
one, however, needs to go beyond these obviously important issues and focus upon
institutional impediments that are outcomes of distributive conflicts and the collective action
problems they exacerbate. These collective action problems arise both at the level of the
state (inefficient interventionism may only be a symptom of those underlying problems) and
at the level of the local community.