Archive for the ‘trade effects’ Category
The role of trade and institutions in promoting religious and other tolerance
I found an extremely interesting paper on SSRN on this topic that examines the historical relationship between trading institutions and religious violence in India.
See Jha, Saumitra,Trade, Institutions and Religious Tolerance: Evidence from India (January 10, 2008). Stanford University Graduate School of Business Research Paper No. 2004. Available at SSRN: http://ssrn.com/abstract=948734. The full-text is available for download.
Jha examined the prevalence of Hindu-Muslim religious riots in India during the period 1850 –1950 and found that trading ports had 25% less religious riots than other Indian towns. He also found that trading ports in Gujarat dating back to medival times, were less afflicted by the 2002 Gujarat riots. Jha explains this difference as due to the persistence of institutional mechanisms that developed to support inter-religious medieval trade. These institutions encouraged specialization, inter-ethnic complementarity, and the mitigation of incentives for ethnic violence by allowing the gains from inter-ethnic trade to be shared between religious groups. Mechanisms for sharing the gains from trade included joint ventures, voluntary provision of public goods and direct inter-group transfers.
Jha’s paper demonstrates the effects of social institutions in preserving social capital and draws attention to how policy interventions are required for trade to contribute to peace. It provides a good example of John Ruggie’s “embedded liberalism” idea, the need for trade liberalization to be embedded in the social community.
