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  4. September 2005
  5. History, Institutions, and Economic Performance: The Legacy of Colonial Land Tenure Systems in India

History, Institutions, and Economic Performance: The Legacy of Colonial Land Tenure Systems in India

  • Abhijit Banerjee
  • Lakshmi Iyer
American Economic Review
vol. 95, no. 4, September 2005
(pp. 1190-1213)
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Abstract

We analyze the colonial land revenue institutions set up by the British in India, and show that differences in historical property rights institutions lead to sustained differences in economic outcomes. Areas in which proprietary rights in land were historically given to landlords have significantly lower agricultural investments and productivity in the post-independence period than areas in which these rights were given to the cultivators. These areas also have significantly lower investments in health and education. These differences are not driven by omitted variables or endogeneity problems; they probably arise because differences in historical institutions lead to very different policy choices.

Citation

Banerjee, Abhijit, and Lakshmi Iyer. 2005. "History, Institutions, and Economic Performance: The Legacy of Colonial Land Tenure Systems in India." American Economic Review, 95 (4): 1190-1213. DOI: 10.1257/0002828054825574

Additional Materials

JEL Classification

  • N45 Economic History: Government, War, Law, International Relations, and Regulation: Asia including Middle East
  • P16 Capitalist Systems: Political Economy