Trade, Institutions and Ethnic Tolerance: Evidence from South Asia

American Political Science Review, Vol. 107, No. 4, November 2013

60 Pages Posted: 3 Oct 2012 Last revised: 1 Oct 2013

Saumitra Jha

Stanford Graduate School of Business

Multiple version iconThere are 2 versions of this paper

Date Written: May 6, 2013

Abstract

I provide evidence that the degree to which medieval Hindus and Muslims could provide complementary, non-replicable services and a mechanism to share the gains from exchange has resulted in a sustained legacy of ethnic tolerance in South Asian towns. Due to Muslim-specific advantages in Indian Ocean shipping, inter-ethnic complementarities were strongest in medieval trading ports, leading to the development of institutional mechanisms that further supported inter-ethnic exchange.

Using novel town-level data spanning South Asia's medieval and colonial history, I find that medieval ports, despite being more ethnically mixed, were five times less prone to Hindu-Muslim riots between 1850-1950, two centuries after Europeans disrupted Muslim overseas trade dominance, and remained half as prone between 1950-1995. Household-level evidence suggests that these differences reflect local institutions that emerged to support inter-ethnic medieval trade, continue to influence modern occupational choices and organizations, and substitute for State political incentives in supporting inter-ethnic trust.

Keywords: Trade, Institutions, Culture, Religion, Cities, Ethnic Conflict, Social Norms, Peace

Suggested Citation

Jha, Saumitra, Trade, Institutions and Ethnic Tolerance: Evidence from South Asia (May 6, 2013). American Political Science Review, Vol. 107, No. 4, November 2013. Available at SSRN: https://ssrn.com/abstract=2155918 or http://dx.doi.org/10.2139/ssrn.2155918

Saumitra Jha (Contact Author)

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

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