IDEAS home Printed from https://ideas.repec.org/p/gnv/wpaper/unige144406.html
   My bibliography  Save this paper

Measuring colonial extraction: the east India company's rule and the drain of wealth (1757-1858)

Author

Listed:
  • Nogues-Marco, Pilar

Abstract

This paper revisits the relationship between capitalism and colonialism by examining the case of British India under East India Company rule (1757-1858). The Marxist-nationalist historiography claims that colonialism generated a steady drain of wealth and that this drain was responsible for Indian famines, poverty, inequality, and economic retardation. I use the East India Company budgets to measure the extent of the wealth that was drained through three direct channels: oppressive land taxes, unproductive expenditures on the imperial army and civil administration, and the unrequited export of commodities from India to Britain. I conclude that available figures lend empirical support to the Marxist interpretation. There was a drain of wealth, and its effect on the underdevelopment of former European colonies deserves further research.

Suggested Citation

  • Nogues-Marco, Pilar, 2020. "Measuring colonial extraction: the east India company's rule and the drain of wealth (1757-1858)," Working Papers unige:144406, University of Geneva, Paul Bairoch Institute of Economic History.
    • Handle: RePEc:gnv:wpaper:unige:144406
    as

    Download full text from publisher

    File URL: https://luniarchidoc4.unige.ch/archive-ouverte/unige:144406/ATTACHMENT01
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Broadberry, Stephen & Custodis, Johann & Gupta, Bishnupriya, 2015. "India and the great divergence: An Anglo-Indian comparison of GDP per capita, 1600–1871," Explorations in Economic History, Elsevier, vol. 55(C), pages 58-75.
    2. Abhijit Banerjee & Lakshmi Iyer, 2005. "History, Institutions, and Economic Performance: The Legacy of Colonial Land Tenure Systems in India," American Economic Review, American Economic Association, vol. 95(4), pages 1190-1213, September.
    3. Stern, Philip J., 2011. "The Company-State: Corporate Sovereignty and the Early Modern Foundations of the British Empire in India," OUP Catalogue, Oxford University Press, number 9780195393736.
    4. Brijesh K. Mishra & Siddhartha Rastogi, 2017. "Colonial Deindustrialisation of India," South Asian Survey, , vol. 24(1), pages 37-53, March.
    5. Mark Dincecco & Gabriel Katz, 2016. "State Capacity and Long‐run Economic Performance," Economic Journal, Royal Economic Society, vol. 126(590), pages 189-218, February.
    6. Roy,Tirthankar, 2018. "A Business History of India," Cambridge Books, Cambridge University Press, number 9781107186927.
    7. Bagchi,Amiya Kumar, 1982. "The Political Economy of Underdevelopment," Cambridge Books, Cambridge University Press, number 9780521284042.
    8. Clingingsmith, David & Williamson, Jeffrey G., 2008. "Deindustrialization in 18th and 19th century India: Mughal decline, climate shocks and British industrial ascent," Explorations in Economic History, Elsevier, vol. 45(3), pages 209-234, July.
    9. Dincecco,Mark, 2017. "State Capacity and Economic Development," Cambridge Books, Cambridge University Press, number 9781108439541.
    10. Roy,Tirthankar, 2018. "A Business History of India," Cambridge Books, Cambridge University Press, number 9781316637487.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nogues-Marco, Pilar, 2020. "Measuring Colonial Extraction: The East India Company’s Rule and the Drain of Wealth (1757-1858)," CEPR Discussion Papers 15431, C.E.P.R. Discussion Papers.
    2. Kumar, Rishabh, 2019. "The evolution of wealth-income ratios in India 1860-2012," SocArXiv sj6h2, Center for Open Science.
    3. Rishabh Kumar, 2020. "Top Indian wealth shares and inheritances 1966–1985," Cliometrica, Springer;Cliometric Society (Association Francaise de Cliométrie), vol. 14(3), pages 551-580, September.
    4. Pim de Zwart & Jan Lucassen, 2020. "Poverty or prosperity in northern India? New evidence on real wages, 1590s–1870s," Economic History Review, Economic History Society, vol. 73(3), pages 644-667, August.
    5. Fenske, James & Kala, Namrata & Wei, Jinlin, 2023. "Railways and cities in India," Journal of Development Economics, Elsevier, vol. 161(C).
    6. Mark Dincecco & James Fenske & Anil Menon & Shivaji Mukherjee, 2022. "Pre-Colonial Warfare and Long-Run Development in India," The Economic Journal, Royal Economic Society, vol. 132(643), pages 981-1010.
    7. Roberto Ricciuti & Antonio Savoia & Kunal Sen, 2019. "What determines administrative capacity in developing countries?," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(5), pages 972-998, October.
    8. Roy, Tirthankar, 2021. "Useful & reliable: technological transformation in colonial India," LSE Research Online Documents on Economics 113442, London School of Economics and Political Science, LSE Library.
    9. Cheng, Hua & Gawande, Kishore & Qi, Shusen, 2022. "State capacity, economic output, and public goods in China," World Development, Elsevier, vol. 158(C).
    10. Roy, Tirthankar, 2019. "State capacity and the economic history of colonial India," LSE Research Online Documents on Economics 100723, London School of Economics and Political Science, LSE Library.
    11. Bishnupriya Gupta, 2019. "Falling behind and catching up: India's transition from a colonial economy," Economic History Review, Economic History Society, vol. 72(3), pages 803-827, August.
    12. Dincecco, Mark & Fenske, James & Gupta, Bishnupriya & Menon, Anil, 2024. "Conflict and Gender Norms," The Warwick Economics Research Paper Series (TWERPS) 1491, University of Warwick, Department of Economics.
    13. Chaudhary, Latika & Rubin, Jared & Iyer, Sriya & Shrivastava, Anand, 2020. "Culture and colonial legacy: Evidence from public goods games," Journal of Economic Behavior & Organization, Elsevier, vol. 173(C), pages 107-129.
    14. Fenske, James & Kala, Namrata & Wei, Jinlin, 2021. "Railways and cities in India," The Warwick Economics Research Paper Series (TWERPS) 1349, University of Warwick, Department of Economics.
    15. Arhan Ertan & Louis Putterman & Martin Fiszbein, 2012. "Determinants and Economic Consequences of Colonization: A Global Analysis," Working Papers 2012-5, Brown University, Department of Economics.
    16. Lu, Yi & Luan, Mengna & Sng, Tuan-Hwee, 2020. "Did the communists contribute to China’s rural growth?," Explorations in Economic History, Elsevier, vol. 75(C).
    17. Sambit Bhattacharyya, 2011. "Growth Miracles and Growth Debacles," Books, Edward Elgar Publishing, number 13609.
    18. Yi Xu & Zhihong Shi & Bas Leeuwen & Yuping Ni & Zipeng Zhang & Ye Ma, 2017. "Chinese National Income, ca. 1661–1933," Australian Economic History Review, Economic History Society of Australia and New Zealand, vol. 57(3), pages 368-393, November.
    19. Bhattacharyya, Sambit, 2011. "Five Centuries of Economic Growth in India: The Institutions Perspective," MPRA Paper 67901, University Library of Munich, Germany.
    20. Fenske, James & Kala, Namrata & Wei, Jinlin, 2021. "Railways and cities in India," CAGE Online Working Paper Series 559, Competitive Advantage in the Global Economy (CAGE).

    More about this item

    Keywords

    India; Colonialism; Drain of wealth; East India Company; Marxism;
    All these keywords.

    JEL classification:

    • B14 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Socialist; Marxist
    • F54 - International Economics - - International Relations, National Security, and International Political Economy - - - Colonialism; Imperialism; Postcolonialism
    • N45 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Asia including Middle East

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gnv:wpaper:unige:144406. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Jean-Blaise Claivaz (email available below). General contact details of provider: https://edirc.repec.org/data/ihegech.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.