Shared Religious Identity, Ruler Displacement, and Literacy in Colonial India

This paper examines how shared religious identity between deposed indigenous rulers and local populations shaped literacy in Colonial India. Using within-district differences across religious groups, we show that Hindu literacy is lower where Hindu rulers were displaced, while Muslim literacy is lower where Muslim rulers were displaced. These patterns do not appear in Princely States, where indigenous rulers retained authority, and are reinforced by instrumental variable strategies. The effects are stronger where rulers had historical ties with local populations, suggesting that removing co-religionist rulers reduced demand for British-led education, highlighting how identity and political displacement shaped the adoption of colonial institutions.