Vegard Iversen from University of Manchester, Adriaan Kalwij from Utrecht University, Arjan Verschoor from University of East Anglia, and Amaresh Dubey from Jawaharlal Nehru University, explore empirically the proposition that the balance of forces linking social identity to economic performance is influenced by the relative economic or political power of the various social groups that live and work in each other's vicinity in rural India. They study three complementary explanations for identity-based disadvantage, the oppression hypothesis, the village enclave hypothesis, and the merit of the proximity hypothesis. They find sizable proximity gains to those residing in upper caste-dominated villages for income and poverty and an offsetting oppression effect of roughly the same order of magnitude. Growth for scheduled caste (SCs) and other backward caste (OBCs) is substantially negatively affected by oppression. Enclave effects are large and positive for OBCs and especially SCs in terms of income and the absence of poverty and for SCs in terms of growth, too.