We describe a model of targeted redistribution choices by a self-interested incumbent politician, and use it to derive predictions about public good provision levels and poverty outcomes following secession of a region from a political union. Secession of one of those other regions, by removing private rent-seeking incentives for the incumbent, reduces targeted redistribution in the seceded jurisdiction, raising public good provision and improving the distribution of welfare. The model's predictions are examined in light of evidence on inequality and poverty outcomes following the political break-up that resulted in the creation three new Indian states. We use satellite data on night-time lights to proxy for economic activity across new and old state borders. Employing a regression discontinuity design we find a significant decrease in inequality in new states post break-up. Our result indicate that this effect is driven entirely by a decrease in inequality amongst natural resource poor regions in the new states, post break-up.