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Towards a Reinterpretation of Nineteenth-Century Indian Economic History*

Published online by Cambridge University Press:  03 February 2011

Morris D. Morris
Morris D. Morris
Affiliation:
University of Washington
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Extract

Indian society is one of the most complex in existence, and we know little about its structure, functioning, or—more important—its development and dynamics. The neglect of Indian's economic history, particularly the period 1800–1947, is one of the most distressing gaps. It is dismaying to realize that even within very broad ranges of error we do not know whether during the past century-and-a-half the economy's performance improved, stagnated, or actually declined. Not only is ignorance of Indian economic behavior over time disturbing in itself, but the attempts at planning since 1947 have suffered because of this. It is difficult to predict outcome and consequences of any major development policy in the absence of any clear clues about the long-run dynamics of the Indian economy and society.

Type
Problems in the Economic History of Asia (Panel Discussion)
Information
The Journal of Economic History , Volume 23 , Issue 4 , December 1963 , pp. 606 - 618
Copyright
Copyright © The Economic History Association 1963

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References

1 This is true whether we attempt to measure performance in terms of per capita income or by any reasonable combination of qualitative-quantitative elements.

2 For some critical comments about scope and method in Indian economic history, see M. D. Morris and B. Stein, “The Economic History of India: A Bibliographic Essay,” The Journal of Economic History, XXI, No. 2 (June 1961), 179–207.

3 There is a current tendency to use Japan as a case to compare with Western economies. This seems to me to miss the problem. For a host of reasons, it is not appropriate to think of Japan as a classical “oriental society.” The characteristics of the Tokugawa and Meiji period make the society much more like Britain in her preindustrial stage.

4 See, for example, Morris, M. D., “Labor Discipline, Trade-Unions, and the State in India,” Journal of Political Economy, LXIII, No. 4 (Aug. 1955), particularly 302–8.Google Scholar

5 The most impressive single analysis along these lines is Dutt, R. C., The Economic History of India (2 vols., 7th ed.; London: Routledge and Kegan Paul, 1950).Google Scholar A very recent article is Bhatt, V. V., “A Century and a Half of Economic Stagnation in India,” The Economic Weekly, XV, combined Nos. 28, 29, and 30 (July 1963), 1229–36.Google Scholar

Marx, in his essays on India, has a brief and powerful description of the smashing of the traditional social and economic society. But his perceptions did not permit him to fall victim to a crude theory of disintegration. He argued that English interference produced “the only social revolution ever heard of in Asia” and that “Bourgeois industry and commerce [will] create these material conditions of a new world.” The most accessible source for the two most important of Marx's essays on India is A Handbook of Marxism, Burns, E., ed. (New York: International Publishers, 1935), pp. 179–194.Google Scholar

6 There are some recent notable exceptions to this. See particularly Gadgil, D. R., The Industrial Evolution of India in Recent Times (4th ed.; Calcutta: Oxford University Press, 1942);Google Scholar and Sovani's, N. V. two essays on “British Impact on India” in Cahiers d'Histoire Mondiale, I, No. 4 (Apr. 1954), 857–82Google Scholar, and II, No. 1 (July 1954), 77–105.

7 Some writers, stressing the total disruption associated with the establishment of British rule, suggest that the Indian economy, racked by famine and depopulation, lay in chaos at the beginning of the nineteenth century. They then proceed to argue that economic conditions worsened through the century. I call this “the theory of infinite and increasing misery.” Apart from certain logical difficulties, this view cannot embrace two fundamental pieces of evidence, the growth of population and the apparent lengthening of life expectancy.

8 I am not pretending to offer a systematic analysis or even a full-blown taxonomy. I shall only mention certain elements which tend to be neglected and which warrant investigation.

9 Basham, A. L., The Indian Sub-Continent in Historical Perspective (London: School of Oriental and African Studies, University of London, 1958), agrees with my major proposition about political instability but not with the causes I have suggested.Google Scholar

10 I ignore the appearance of modern plantation crops such as tea, rubber, and coffee, which were modern innovations.

11 For some very provocative insights into basic geographical and climatic limitations on raising agricultural productivity in India, see Howard, Louise E., Sir Albert Howard in India (London: Faber and Faber, 1953).Google Scholar I ignore the implications of these factors for current efforts to achieve temperate-zone levels of agricultural output. On the quality of Indian peasant agriculture, see Sir Albert Howard and Voelcker, J. A., Report on the Improvement of Indian Agriculture (London, 1893).Google Scholar

12 Most writers leave the impression that the vast bulk of land now used was also tilled in traditional India and that the extensive uncultivated regions found at the beginning of the nineteenth century were areas which had fallen out of cultivation due to the disorders attendant on British conquest. A reading of the writings of sixteenth- and seventeenth-century travelers suggests that this is incorrect.

13 The high probability of this notion is reinforced by an examination of Indian imports and exports from 1500 to 1800. Apart from cotton textiles, virtually all exports were primary agricultural products, while imports included a substantial proportion of metals in various stages of fabrication.

14 Early European travelers often noted the primitive character of Indian technology when compared with their own. See, for example, Relations of Golconda, Moreland, W. H., ed. (London: Hakluyt Society, 1931), pp. 31–32.Google Scholar The English factory records of the seventeenth century constantly stress the inelasticity of textile supplies and low per-loom productivity.

15 One should not make the mistake of assuming that the importance of the international trade in textiles in the seventeenth and eighteenth centuries is a measure of its significance to the Indian economy. I would argue that the great impact of this trade was felt primarily in the European economies.

16 My own general impression is that the traditional Indian society was supported at a lower level of real income per capita than was the case in early modern Europe or even in Tokugawa Japan. As Thomas Kerridge wrote in 1619, “though this countrie be esteemed rich, we finde the common inhabitants to be verie needie.…” Foster, W., The English Factories in India, 1618–1621 (Oxford: Clarendon Press, 1906), p. 138.Google Scholar

The characteristics I have described are not all typical of every “traditional” society. If I am right, this raises important doubts about the usefulness of Rostow's “stage” theory. His tendency to generalize about the characteristics of traditional societies ignores the enormous diversities which exist among them and leads to erroneous conclusions about the nature of subsequent developments.

17 It will be noted that I have not included caste as one of the distinctive and significant features of traditional Indian society. For reasons too complex to enter into here, I am assuming that caste has been a consequence rather than a cause and is largely irrelevant to fundamental economic change and growth. Caste and ideology may define the groups which first respond to a new situation and therefore first benefit from a change; but this is a distributive rather than a growth phenomenon.

18 It is frequently implied that the British conquest of India represented the triumph of the Industrial Revolution. It must be noted, however, that British rule was firmly established by 1820, before the Industrial Revolution could have played any major role. While the superiority of Western technology was already substantial in the eighteenth century, I suggest that the main sources of European power in India stemmed from the superiority of administrative skills of various sorts. While this can be interpreted in economic terms, my point is that the origin of this advantage can not be found in the steam engine but more likely flows initially from the organizational innovations of the Roman Catholic church, of the nation state, and of early modern military administration.

19 Again let me make it clear that I am only attempting to identify a limited number of important factors. I am not attempting a systematic analysis of the total economic process.

20 Not until the decade 1921–1931 did the average rate of population growth rise above 1 per cent per year.

21 Davis’, Despite K. study, The Population of India and Pakistan (Princeton: Princeton University Press, 1951)Google Scholar, there is still need for basic analysis of nineteenthand twentieth-century population trends. For example, I am still not at all satisfied by the typical explanations of the sudden acceleration of population growth after 1921.

22 The administrative cadre developed to administer India was surprisingly small, and the tasks required of the bureaucracy were limited by the “night watchman” objectives of the government. In terms of the requirements of the modern planning state, India at the time of Independence was under-administered. Many of the country's current difficulties stem from this fact.

23 For some confirmation of these suggestions, see Neale, W. C., Economic Change in Rural India: Land Tenure and Reform in Uttar Pradesh, 1800–1955 (New Haven: Yale University Press, 1962), particularly pp. 141–48.Google Scholar

24 There is Marx's famous quotation from the Governor-General's report of 1834–35: “The bones of the cotton-weavers are bleaching the plains of India.” Capital, I (Chicago: Charles H. Kerr & Co., 1906), p. 471.Google Scholar

25 I am working on a detailed analysis of this problem which I hope to publish in the near future.

26 For example, there was an increasing tendency for women to wear bodices in addition to the traditional saris.

27 Many tribal groups seem to have shifted from jute cloth. This might have worsened the economic status of jute producers except for the growing foreign demand for jute for commercial purposes.

28 The classical argument is based on census data which purported to show that between 1872 and 1931 a growing proportion of the population became dependent on agriculture. This evidence has recently been effectively demolished. See , D. and Thorner, A., Land and Labour in India (London: Asia Publishing House, 1962), pp. 70–81.Google Scholar

29 For a sophisticated analysis which elaborates on this point, see Aubrey, H. G., “Industrial Investment Decisions: A Comparative Analysis,” Journal of Economic History, XV, No. 4 (Dec. 1955), pp. 335–51.CrossRefGoogle Scholar

30 Some traditionally exported products like textiles diminished in importance, but the growth in size and number of ships involved in India's international trade makes it clear that the total trade grew, not only absolutely, but on a per capita basis, during the century.

31 Moreover, there is no evidence to suggest that the distribution of income became more unequal over time. If anything, the trend probably ran the other way.

32 See, for example, K. Mukerji, “A Note on the Long Term Growth of National Income in India, 1900–01 to 1952–53,” in Indian Conference on Research in National Income: Papers on National Income and Allied Topics, Vol. II, Rao, V. K. R. V.et at., eds. (London: Asia Publishing House, 1962), pp. 15–24.Google Scholar For another similar analysis containing a discussion of some of the problems of estimation and a bibliography, see Patel, S. J., “Long-Term Changes in Output and Income in India: 1896–1960,” Indian Economic Journal, V, No. 3 (Jan. 1958), pp. 233–46.Google Scholar

33 While a great deal of this expansion was financed by British capital, there is a problem here which relates to the rate of real saving in the Indian economy. For economists, the implication of foreign investment is that during the period of net foreign investment the lending society is transferring real resources to the borrowing society, which is then able to expand its capital at a rate greater than its propensity to save. However, fragmentary evidence I have examined for the nineteenth century suggests that the overwhelming bulk of British capital invested in India came from Englishmen resident in India and out of earnings made there. In a large number of instances the initial British accumulations flowed from monopoly privileges obtained through the East India Company or from connections with the imperial government.

It might be useful to reexamine the entire question of nineteenth-century foreign investment along these lines, stressing the transfer of real resources rather than the reinvestment of earnings. There would be serious problems of conceptualization, but I suspect that a study in these terms might well challenge the notion that large-scale transfers of real resources from Britain to India were important in the nineteenth century. If correct, such a study would also suggest there has been a higher rate of real saving in India than is typically assumed.

34 This statement is not intended as any criticism of English rule in India. One does not need to argue in terms of the evilness of imperial policy. Certainly, the general object of the raj was the welfare of the society. The difficulty is that British economic policy in India could not rise above the ideological and policy level at work at home. And a general economic policy appropriate for Britain at the peak of her economic power was not adequate to provide for long-run growth in India.

35 Some notion of the problems of getting a major new enterprise started when the task involved relations with the government is hinted at in Fraser, L., Iron and Steel in India (Bombay: The Times Press, 1919).Google Scholar

36 For example, the railways in India bought all their equipment and stores in Britain except for coal.

37 Given falling per capita income after 1920, one would have expected fairly widespread Malthusian consequences. It is hard to conceive of the rate of population continuing to rise under these circumstances. More important, one would have expected a changed price relationship between food crops and commercial crops, which would have prevented the systematic shift of land into the production of commercial agricultural products that was occurring during this whole period.

If, however, further research should conclusively show a falling per capita income after 1920, this would lend support to my conclusion that per capita income had risen in the previous century. Had the decline in per capita incomes occurred from the level of economic activity current in the eighteenth century, nothing could have prevented the operation of Malthusian checks. There would have been no margin to prevent this. However, the rise in per capita output during the nineteenth century provided a surplus above subsistence, which made it possible for the society to tolerate a decline in real incomes without causing utter social disaster.

38 In recent years, economists have been so preoccupied with output as a measure of the tempo of economic development that they have neglected the structural changes through which an economy must go—changes which may initially appear to be accompanied by stagnating output. For example, the first forty years of the eighteenth century in Britain “show few signs of growth in the economy as a whole.” Deane, P. and Cole, W. A., British Economic Growth, 1688–1959: Trends and Structure (Cambridge: [Engl.] The University Press, 1962), p. 79.Google Scholar