Naxalites and Extralegal Governance

Abstract: Naxalites are an armed, extralegal Marxist-Maoist group that operates in a significant portion of India along the easter corridor, mostly in tribal areas and the jungles. Although much maligned by mainstream media and the state, the Naxalites are political entrepreneurs, who provide valuable public goods, including governance services in areas where the formal state does not operate, and in turn levy taxes on businesses and civilians (the government terms this extortion). There is unmet demand for governance services, and the Naxalites supply the services. A major part of the services they provide includes the protection of property rights (and in some cases, a system of liability rules) and settling disputes involving negative externalities (trespass, etc). My field-based interviews with a wide variety of actors in the Naxalite landscape, including the Naxalites in rebel camps, indicate a surprising feature - while they self-define as a Marxist organization, the kind of decisions that they make are designed to promote economic efficiency in much the same way that mainstream neoclassical economists would promote. I argue that the "Marxist" or "Maoist" labels are mere iconic devices to bring political entrepreneurs together and that one of the organization's main goals is to protect private property and increase economic efficiency in transactions.