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State Capacity and the Economic History of Colonial India
Author(s) -
Roy Tirthankar
Publication year - 2019
Publication title -
australian economic history review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.493
H-Index - 16
eISSN - 1467-8446
pISSN - 0004-8992
DOI - 10.1111/aehr.12166
Subject(s) - centralisation , debt , colonialism , state (computer science) , public finance , investment (military) , revenue , economics , business , fiscal capacity , economic policy , financial system , market economy , finance , political science , macroeconomics , politics , algorithm , computer science , law
The paper re‐examines the role of the state in economic change in colonial India (1757–1947), by paying attention to fiscal capacity. This capacity was larger than that of the precolonial states, and based on different foundations, such as centralisation of finance and securitisation of public debt. Nevertheless, the effort to raise finance hit a barrier, which had owed to the separation of debt from revenue operations. Did the barrier matter? By keeping markets open, the colonial state served private enterprise, but its failure to sustain growth in fiscal capacity compromised public investment in infrastructure and social development.