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Are Special Economic Zones a curse on those ‘chosen’ to be evicted? Evidence from West Bengal, India.

Discussion Papers

No.472

by Saumik Paul and Vengadeshvaran Sarma
August 2014

ABSTRACT

Using data from a self-administered survey of 1,017 households we assess the long-term impact of establishing a special economic zone, on those who are exogenously selected to be displaced. We find those who are displaced suffer from lower land compensation and lack of adequate property rights. There is also some evidence of lower labour market participation among those who are displaced. However, in the long term, across measurable welfare indicators, we do not find that displaced households are significantly different from other households. One source of this resilience is through employment at the special economic zone – which is higher among displaced households compared to other households. Another factor that contributed to the absence of differences is spill-over effects; which made access to employment, education and other facilities about homogenous across displaced and non-displaced households.


Keywords: Special Economic Zones, Compensation, Property Right, Rural livelihoods, India

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