This paper purports to understand whether voting along narrow parochial lines in socially and ethnically fragmented societies has measurable gains. Using data from rural India, we establish that identity based voting, driven by membership in social and informal networks, will lead to enhanced participation in welfare programs, which in turn leads to increased consumption growth. We also show that reducing agency costs does not necessarily remove the need for identity‐based voting, and that such voting behavior is a means for engaging in capture of public and private benefits by these groups. Some policy recommendations are also advanced.