Economic Modernization in Late British India: Hindu-Muslim Differences

49 Pages Posted: 9 Aug 2010

See all articles by Timur Kuran

Timur Kuran

Duke University - Department of Economics

Anantdeep Singh

University of Southern California - Center for Religion and Civic Culture

Multiple version iconThere are 2 versions of this paper

Date Written: July 1, 2010

Abstract

The Muslims of South Asia made the transition to modern economic life more slowly than the region’s Hindus. In the first half of the twentieth century, they were relatively less likely to use large-scale and long-living economic organizations, and less likely to serve on corporate boards. Providing evidence, this paper also explores the institutional roots of the difference in communal trajectories. Whereas Hindu inheritance practices favored capital accumulation within families and the preservation of family fortunes across generations, the Islamic inheritance system, which the British helped to enforce, tended to fragment family wealth. The family trusts (waqfs) that Muslims used to preserve assets across generations hindered capital pooling among families, and they were ill-suited to profit-seeking business. Whereas Hindus generally pooled capital within durable joint family enterprises, Muslims tended to use ephemeral Islamic partnerships. Hindu family businesses facilitated the transition to modern corporate life by imparting skills useful in large and durable organizations.

Keywords: India, Islam, Hinduism, capital accumulation, inheritance, partnership, corporation, waqf, economic development

JEL Classification: N25, N85, K22, O53, P48

Suggested Citation

Kuran, Timur and Singh, Anantdeep, Economic Modernization in Late British India: Hindu-Muslim Differences (July 1, 2010). Economic Research Initiatives at Duke (ERID) Working Paper No. 53. Available at SSRN: https://ssrn.com/abstract=1656038

Timur Kuran (Contact Author)

Duke University - Department of Economics ( email )

213 Social Sciences Building
Box 90097
Durham, NC 27708-0204
United States

Anantdeep Singh

University of Southern California - Center for Religion and Civic Culture ( email )

Los Angeles, CA 90089
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
277
rank
31,578
Abstract Views
1,937
PlumX Metrics
!

Under construction: SSRN citations will be offline until July when we will launch a brand new and improved citations service, check here for more details.

For more information