Direct versus Indirect Colonial Rule in India


Lakshmi Iyer*

The Review of Economics and Statistics, November 2010, 92(4): 693–713

Abstract—This paper compares economic outcomes across areas in India
that were under direct British colonial rule with areas that were under
indirect colonial rule. Controlling for selective annexation using a specific
policy rule, I find that areas that experienced direct rule have significantly
lower levels of access to schools, health centers, and roads in the postcolonial
period. I find evidence that the quality of governance in the colonial period
has a significant and persistent effect on postcolonial outcomes.