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Deliberate Surrender? The Impact of Interwar Indian Protection

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  • Vellore Arthi
  • Markus Lampe
  • Ashwin Nair
  • Kevin Hjortshøj O’Rourke

Abstract

What is the role of trade policy in promoting intra-Empire trade? We address the question in the context of interwar India, whose trade policies have been accused of harming British export interests. We quantify the impact of trade policy on the value and composition of Indian imports, using novel disaggregated data on both trade policies and imports for 114 commodity categories coming from 42 countries. We find that, even though Indian protection lowered total imports, it substantially boosted imports from the United Kingdom. Despite the rising tariff barriers facing British exporters, trade diversion from other countries ensured that Indian trade policy benefited them overall.

Suggested Citation

  • Vellore Arthi & Markus Lampe & Ashwin Nair & Kevin Hjortshøj O’Rourke, 2024. "Deliberate Surrender? The Impact of Interwar Indian Protection," The Economic Journal, Royal Economic Society, vol. 134(657), pages 23-47.
    • Handle: RePEc:oup:econjl:v:134:y:2024:i:657:p:23-47.
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    File URL: http://hdl.handle.net/10.1093/ej/uead073
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