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Measures of Risk Aversion

Systematic statistical information on outbreaks of religious violence in India is relatively hard to come by, and our choice of time period is constrained by the available overlap of conflict data and economic information. On conflict, we use a data set compiled by Steven Wilkinson and Ashutosh Varshney. ðSee, in particular, the recent use of this data set in Wilkinson ½2004.Þ It summarizes reports from The Times of India, a leading national newspaper, on Hindu-Muslim conflicts in India in the second half of the twentieth century. This data set has information on deaths, injuries, and arrests. It does not provide hard information on which side initiated the violence, for in most cases that issue would necessarily be mired in subjectivity. For every report of Hindu-Muslim violence, the data set provides the date of incidence of the riot; the name of the city/town/village; the district and state; its duration; the number of people killed, injured, and arrested; and the reported proximate cause of the riot. The following summary provides some sense of the pervasiveness and intensity of Hindu-Muslim riots in post-Independence India. Between 1950 and 1995, close to 1,200 separate riot episodes were reported, with over 7,000 individuals killed. Between 1950 and 1981, the average number of Hindu-Muslim riots in India was 16 per year. This same number for the period between 1982 and 1995 happens to exceed 48. Over these 14 years, a total of 674 riots were reported with close to 5,000 deaths. Therefore, over half the reported riots between 1950 and 1995 ðand around two-thirds of total deathsÞ occurred during a period that was less than one-third as long as the total period for which we have data. In other words, religious conflict appears to have sharpened significantly as we move from 1950–81 to 1982–95. We utilize the Varshney-Wilkinson data from 1979 to 1995. Furthermore, we have extended this conflict data set by a period of 5 years, that is, from 1996 to 2000.14 The main reason for limiting ourselves to this time period is the nonavailability of reliable data on economic conditions ðby religious groupÞ for earlier years. At the same time, the observations made above highlight the importance of religious violence in the 1980s and 1990s. We use three different count measures from the data set: the number of people killed or injured ð“casualties”Þ, the number of people killed, or the number of riot outbreaks over the period. In all cases, we take aggregates over a 5-year period in each location.