10.11.2012 - Saumitra Jha

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Trade, Institutions and Ethnic Tolerance: Evidence from South Asia

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10.11.2012 - Saumitra Jha

  1. 1. Trade, Institutions and Ethnic Tolerance: Evidence from South Asia Saumitra Jha Stanford Graduate School of Business Fellow, CSDP and Niehaus CGG, Princeton IFPRI, October 2012
  2. 2. February 27th, 2002: Godhra, Gujarat
  3. 3. Feb-Apr 2002: Ahmadabad massacres, Surat peace Ahmadabad: 13 percent Muslim: 24+ days rioting, 324+ dead (including old city). * # Surat: 12.3 percent Muslim: 6 Ahmadabad days of rioting, 9+ dead (in * # " * # * # Godhra $ new suburbs) * # * # * # * # Over the course of 20th * # * # * # * # # Surat * * # * # century- Ahmadabad * # riot-prone; Surat, “an oasis of peace”. 0 30 60 120 Miles
  4. 4. The research agenda How do we encourage cooperation and peaceful co-existence between members of different ethnic, religious and social groups? What strategies have achieved these aims historically? What lessons can such strategies provide for contemporary policy? Financial innovations (“Swords into Bank Shares”)(Jha 08, Jha and Mitchener, in prog.) Organizational capacity acquired through war (among vulnerable minorities)(Jha and Wilkinson 12) Exogenous ∆ inter-ethnic complementarities
  5. 5. This paper Can exogenous changes that generate robust inter-ethnic complementarities have a lasting effect on peaceful co-existence in ethnically- diverse societies? In South Asia- yes.
  6. 6. This paper finds... 200 yrs after decline of exogenous, non-replicable minority complementarities in overseas trade, medieval ports that were the geographical focuses of the resulting Hindu-Muslim exchange: 5x ↓ Hindu-Muslim riots (S. Asia, 1850-1950), (Gujarat, 2002). 25 pp ↓ any Hindu-Muslim riot 10x ↑ survival probability of tolerance each year (though diminishing over time). Despite: ↑ ethnic mix, ↓ income. In fact, effects bigger in larger, more ethnically diverse towns. Further, household and town-level evidence for: ∆ voting consistent with minority safe havens (Gujarat 2002) ∆ in between group inequality, membership in inter-ethnic organizations, sustained ethnic specialization in trade, behavioural measures of minority trust, 2005
  7. 7. Mechanisms: what it might be and what it ain’t Evidence that highlights role of exogenous non-replicable minority complementarity. Not just: . . . Historic wealth in towns which lacked complementarities (mint towns). . . . Or medieval trade (inland trade routes) or modern trade (modern ports) where complementarities could be replicated . . . Or survivorship (medieval towns) . . . Or historic human capital by itself (artisanal towns) - in fact human capital and institutions are complements . . . Or selection of ports due to continued congenial geography Silted medieval ports show similar effects to other ports. Medieval natural harbour driver of medieval port location was medieval period-specific (does not predict colonial ports).
  8. 8. Trade and polarisation: Somnath temple, sacked 1026
  9. 9. Medieval ports and religious violence in India Towns, Not Medieval Natural Harbours, Not Medieval Ports Ports Medieval Ports Riots, 1850-1950 Obs Mean SD Obs Mean SD Obs Mean SD # of Hindu-Muslim Riots 476 1.116 3.416 53 0.925 5.487 59 0.136 0.472 Any H-M Riot 476 0.418 0.494 53 0.170 0.379 59 0.102 0.305 # Killed in H-M Riots 476 23.277 242.361 53 88.906 639.995 59 0.136 0.571 Total Days of H-M Riots 476 1.630 11.301 53 3.000 20.598 59 0.051 0.289 Colonial Era Outcomes and Covariates % Muslims 1901 244 29.879 17.732 20 18.596 14.884 22 32.449 22.101 Mun. Income per Capita 316 1.805 3.092 28 2.155 2.6382 28 1.580 1.103 Colonial Overseas Port (1907) 476 0.038 0.191 53 0.170 0.379 59 0.356 0.483 Log. Population 1901 476 9.672 1.129 53 9.420 1.209 59 9.170 1.315
  10. 10. A paradox? Montesquieu (18C): commerce encourages “civility” between individuals due to mutual self-interest. However: Chua (21C): commercially-oriented ethnic minorities are often the focuses of ethnic violence. Examples: Chinese in Indonesia Indians in East Africa Many others.
  11. 11. A framework Focus: environments with “non-local” ethnic minorities: better outside options. Our example: “non-local” Muslim traders had external resources (information and ties to the Middle East): made leaving town less costly than for “local” Hindus.
  12. 12. Conditions that favour “peaceful co-existence” (SPNE with mixed populations, full production, no leaving) 1. Non-locals provide complementary goods If not: “strong” locals have incentive to target non-locals to seize goods and induce non-locals to leave, reducing future competition If so: reduced incentive for ethnic violence: if non-locals leave, non-local- supplied goods become more costly in future. 2. High cost to seize or replicate source of other group’s complementarity. If not: incentive to violently seize or (over time) replicate. 3. Mechanism to redistribute gains from exchange If not: complementarity + limited supply ⇒ higher returns for non-local goods⇒ incentive for strong locals to seize non-local profits. Formal model
  13. 13. Muslims in medieval Indian ports Complementarity: Pilgrimage ↔ Trade Non-expropriable, replicable (intangible, network externalities) Non-violent transfers: Ease of entry Complementary “institutional” mechanisms: cultural norms, organizations, beliefs. (source: Diogo Homem 1558)
  14. 14. A 1000 years of religious tolerance? Now in all these (Malabari ports) the population became much increased and the number of buildings enlarged, by means of the trade carried on by the Mahomedans, towards whom the chieftains of those places abstained from all oppression; and, notwithstanding that these rulers and their troops were all pagans, they paid much regard to their prejudices and customs, and avoided any act of aggression on Hogenburg the Mahomedans, except on some and extraordinary provocation; this amicable Braun footing being the more remarkable, from the (1572) circumstance of the Mahomedans not forming a tenth part of the population . . . - Shaikh Zaynnudin al Ma’abari, Tuhfat-ul-Mujahideen, 1528.
  15. 15. Definitions Riots a violent confrontation between 2 communally-identified groups newspaper reports, official records Medieval trading ports: Evidence of direct overseas trade, prior to 18th C & independent of Europeans. Periplus Maris Erythraei (ca. 1st-3rd C) Traveller’s narratives (eg Ibn Battuta 1355, di Verthema 1503, Zayn al Din 1528) Imperial gazetteers (1907)
  16. 16. New GIS:(Ain-i-Akbari, ca 1590s-1707) ! ! ! ! + $! ! ! ! ! ! ! !! ! !! !! + $ ! !! ! ! ! ! !! ! !!! ! ! ! ! + $ !Lahore + $!! ! ! ! ! ! + $! !!! !! !! ! !! ! + $ ! ! ! !! + $ !!! ! ! ! ! 0 75 150 300 450 600 Kilometers ! ! ! ! + $! Delhi ! ! ! ! ! ! ++ $$ ! ! ! ! ! ! ! !! + ++ $ $$ !!! ! ! ! ! ! !! ! !! ! ! ! ! ! ! !! ! !! ! ! + $+ $ + $ $ $ Agra ! ! ! !! !! ! ! ! !! ! Lucknow ! ! ! ! ! ! + + + $ !!! !! ! ! ! ! ! ! ! ! ! !! + ++ + $ $$ $ ! ! !! ! + $ ! + $ ! ! !! ! ! !! ! !! ! ! ! ! ! + $ + + $ $ ! Patna ! ! !! ! ! !!! !! !! ! ! ! ! ! ! !! !! ! ! ! !! ! ! ! ! ++ $$ ! ! + + $ $ ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! !! ! ! ! ! ! !! ! ! ! ! !!! !! ! !!!! !! ! ! + $ ! ! !!! !! ! ! ! ! ! ! ! !! ! ! + $ ! ! ! ! ! ! ! ! !! ! ! !! !! ! ! !! ! ! ! ! ! $ Ahmadabad$ $ + ! ! ! + + $ ! ! ! ! ! ! ! ! ! ! ! ! ! + $ ! ! ! ! ! ## + $ + $ + !!! ! !! ! !! ! ! !! ! ! ! ! ! ! !! ! !! ! ! ! ! ! ! + $ ! ! ! # + $ ! ! ! !! !! !! !! ! ! ! !! ! ! ! ! ! ! ! ! ! !! ! # #$ + !! # ! ! ! ! !! ! # + $ ! ! ! ! ! ! Porbandar # ! ! ! ! # Surat# $ + + $ $ ! # $ + Balasore ! ! ! !! ! ! ! ! ! ! !! ! ! !! ! ! ! ! !! # !! ! ! ! # + ! ! Veraval !! !! ! ! ! ! + $ ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! !! + $ + ! ! !! ! ! # $$ ! ! ! !! + !! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! + $ $ $ $Hyderabad # ! ! ! !! + ++ Bijapur ! ! ! !! ! !! !! !! ! ! ! !! ! !! + $ ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! ! !! !! ++ $$ # ! ! !! !! !! ! ! ! !! ! !! ++ $$ ! ! ! ! ! ! ! ! ! !! + $ ! ! ! ! ! ! ! # $ + ! !! ! ! ! ! + $ ! ! ! ! ! ! ! ! ! ! ! ! ! ++ $$ ! # ! ! Mangalore ! ## Legend # Calicut # ! Internal Trade Route Navigable Rivers # + $ Cochin Mughal Mints # # Medieval Ports Muslim Rule to 1707 (Years) #
  17. 17. GIS allows a rich set of controls and correlates 1. Initial geographic factors: Latitude/ Longitude2 , Prox. to coast, coastal town, Prop. natural disasters, Prox. navigable rivers 2. Historical factors: Prox. Ganges (caste), Centuries Muslim Rule, Mint Town, Skilled Crafts, Historical Shi’a rule 3. Contemporaneous factors: Province / Native State intercepts, Modern overseas port 4. Correlates: Prop. Muslim 2 in town, district, Municipal income per capita
  18. 18. Medieval S. Asia(Ain-i-Akbari, ca 1590s-1707) ! ! ! ! + $! ! ! ! ! ! ! !! ! !! !! + $ ! !! ! ! ! ! !! ! !!! ! ! ! ! + $ !Lahore + $!! ! ! ! ! ! + $! !!! !! !! ! !! ! + $ ! ! ! !! + $ !!! ! ! ! ! 0 75 150 300 450 600 Kilometers ! ! ! ! + $! Delhi ! ! ! ! ! ! ++ $$ ! ! ! ! ! ! ! !! + ++ $ $$ !!! ! ! ! ! ! !! ! !! ! ! ! ! ! ! !! ! !! ! ! + $+ $ + $ $ $ Agra ! ! ! !! !! ! ! ! !! ! Lucknow ! ! ! ! ! ! + + + $ !!! !! ! ! ! ! ! ! ! ! ! !! + ++ + $ $$ $ ! ! !! ! + $ ! + $ ! ! !! ! ! !! ! !! ! ! ! ! ! + $ + + $ $ ! Patna ! ! !! ! ! !!! !! !! ! ! ! ! ! ! !! !! ! ! ! !! ! ! ! ! ++ $$ ! ! + + $ $ ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! !! ! ! ! ! ! !! ! ! ! ! !!! !! ! !!!! !! ! ! + $ ! ! !!! !! ! ! ! ! ! ! ! !! ! ! + $ ! ! ! ! ! ! ! ! !! ! ! !! !! ! ! !! ! ! ! ! ! $ Ahmadabad$ $ + ! ! ! + + $ ! ! ! ! ! ! ! ! ! ! ! ! ! + $ ! ! ! ! ! ## + $ + $ + !!! ! !! ! !! ! ! !! ! ! ! ! ! ! !! ! !! ! ! ! ! ! ! + $ ! ! ! # + $ ! ! ! !! !! !! !! ! ! ! !! ! ! ! ! ! ! ! ! ! !! ! # #$ + !! # ! ! ! ! !! ! # + $ ! ! ! ! ! ! Porbandar # ! ! ! ! # Surat# $ + + $ $ ! # $ + Balasore ! ! ! !! ! ! ! ! ! ! !! ! ! !! ! ! ! ! !! # !! ! ! ! # + ! ! Veraval !! !! ! ! ! ! + $ ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! !! + $ + ! ! !! ! ! # $$ ! ! ! !! + !! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! + $ $ $ $Hyderabad # ! ! ! !! + ++ Bijapur ! ! ! !! ! !! !! !! ! ! ! !! ! !! + $ ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! ! !! !! ++ $$ # ! ! !! !! !! ! ! ! !! ! !! ++ $$ ! ! ! ! ! ! ! ! ! !! + $ ! ! ! ! ! ! ! # $ + ! !! ! ! ! ! + $ ! ! ! ! ! ! ! ! ! ! ! ! ! ++ $$ ! # ! ! Mangalore ! ## Legend # Calicut # ! Internal Trade Route Navigable Rivers # + $ Cochin Mughal Mints # # Medieval Ports Muslim Rule to 1707 (Years) #

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