This paper provides novel evidence on how political connections distort environmental regulatory enforcement in Maharashtra’s Sugar Industry, using a unique natural experiment that creates simultaneous bidirectional variation in political access. We exploit a political crisis in Maharashtra, India, which caused some sugar mills to suddenly lose political connections while others gained it. Combining novel data on regulatory punishment, environmental & operational outcomes for sugar mills, we find that mills losing political access experience significantly higher enforcement rates, while mills gaining connections face no change in regulatory pressure. This effect is driven entirely by discretionary enforcement rather than complaint-driven inspections. Using granular emissions monitoring data, we show that this is not driven by changes in environmental performance by mills who lose political connections, while mills gaining connections significantly increase pollution-hiding behavior yet face no regulatory consequences. These findings demonstrate systematic heterogeneity in environmental enforcement in a weak institution setting.

The effectiveness of corporate climate initiatives depends not only on firms’ commitments but also on existing asset ownership structure. We study this in the context of the World Bank’s Zero Routine Flaring (ZRF) initiative, where oil & gas companies made voluntary commitments to reduce flaring. Using asset-level data on ownership structure & flaring, we show that firms committing to ZRF modestly reduce flaring from their assets over time. However, the persistence of these gains hinges on the distribution of committed ownership. When multiple committed firms share control of an asset, flaring remains unchanged even as one committed company exits. In contrast, when the last committed owner divests its stake, flaring rises sharply. This result holds even when the committed company is not the operator of the asset around divestment, suggesting that committed companies put downward pressure on pollution when they are on the board. These results highlight that effectiveness of voluntary environmental initiatives depend on ownership structure.

This paper studies whether politically driven cross-subsidies in electricity pricing—low tariffs for agricultural users financed by high industrial tariffs—distort structural transformation in India. I assemble a new state–year panel that recovers category-specific electricity prices and sectoral employment to quantify how cross-subsidies shape structural transformation in India. Using a shift-share instrument interacting national coal price movements with state thermal-generation shares, reflecting Coal India’s nationally set coal prices that pass through to power costs, I find that increases in the industrial–agricultural price wedge reallocate employment away from manufacturing toward agriculture. These findings suggest that electricity cross-subsidies can hinder manufacturing-led structural transformation by raising the relative cost of operating capital, with implications for the design of politically salient but distortionary tariff policies.

This paper examines how ownership structure influences environmental outcomes in India’s sugar industry, where mills vary between cooperative and private ownership. We combine satellite data on pollution exposure with mill-level characteristics from the Vasantdada Sugar Institute and regulatory records from the Maharashtra Pollution Control Board. To identify the causal effect of ownership, we exploit variation in the mass sale of sick cooperative mills to private buyers in late 2010s. We test whether cooperative mills generate less pollution due to stronger local accountability: in cooperatives, farmers are both suppliers and shareholders, and they elect the mill chairman, giving them institutional power to demand cleaner operations when pollution harms their land or health. We also examine whether this accountability channel is offset by political capture, using variation in board composition and election timing. The findings contribute to understanding how ownership and governance shape firm behavior in settings with weak formal enforcement and localized externalities.