Book review: Jan Lucassen and Radhika Seshan (Eds.),Wage Earners in India 1500–1900: Regional Approaches in an International Context

The emergence of Indo-European trade from the seventeenth century, and the rise and fall of states and empires in the Gangetic Basin and Deccan Plateau of India changed the economic conditions of regions already among the most populous in the world. How much did conditions change due to these new forces, economic and political, between the seventeenth century and the nineteenth? We do have information on the shifting fortunes of the elite classes, which is a partial measure at best. Quantitative studies to measure changes in the living standards of ordinary people are rare. Although in the interwar period, scholars like Brij Narain and Radhakamal Mukerjee, compiled wage datasets for northern India (Mukerjee, 1939; Narain, 1929), these remained almost unused in economic history research until recently.

In the 2000s, and especially the 2010s, interest in living standards, labour, and wages, revived. Levels and trends in real wages became crucial evidence in claims about the origins of world inequality. Driven by that new purpose, many studies were produced using more data over longer periods. Various scholars compared wage levels and trends across Europe and India (Allen, 2007; Broadberry et al., 2015; Parthasarathi, 1998; Sivramkrishna, 2009). These attempts to reconstruct the long-term changes in average living standards sometimes used the interwar datasets but also collected more statistics from regional sources. The new international scholarship drew material from several world regions and, while improving the method of extracting information from wages, also faced criticism.

Historians can observe a sum of money paid by an employer to an employee but cannot always say what service this was paid for, whether this was compensation for a whole family’s work or an individual’s; the employment was year-round or seasonal; or whether it was a customary payment or negotiated one. There are three larger issues besides this problem that we know less about the work and the workers than we would like to. First, given the extensive presence of unfree labour, how big was the market for hired labour in the past? Second, considering that most types of information on wages earned by ordinary people came from the archives of European traders and trading firms and that the Europeans operated mainly on the coastal commercial zones, can we reduce the dependence on European sources and expand our knowledge of labour markets beyond the coastal regions? The third issue concerns price levels on average, and changes in these levels over time. Wage rates or earnings would mean nothing without prices. To compare wages across space or over time, we need to adjust these numbers by prices. How much do we know about prices, or ‘the wage-price structure’, as one of the contributors to this book, Ranade, calls it?

Wage Earners in India is not just a new contribution to this scholarship. It breaks new ground. The book tries to answer some of these questions by exploiting the resources of several archives that had not been used for comparative economic history. Although the attempt to process these statistics must remain subject to some of the problems that all such attempts entail, the richness of the data adds value to the project in several ways, by offering insights into the meaning of labour, broader coverage of regions, and especially, by integrating the southern peninsular region or Deccan into the living standards discourse. Edited by two eminent historians, Jan Lucassen and Radhika Seshan, the book brings together research studies that would otherwise remain known only to regional specialists.

The introductory chapter outlines the intellectual context of living standard studies and delves into the source problem of finding sufficient wage data and how best to use them. A tour de force, the chapter will be useful as a teaching aid. Chapter 1 (by Hélder Carvalhal, Paulo Teodoro de Matos, and Jan Lucassen) reconstructs wage series based on Portuguese archival resources on India and concludes that Indo-European trade and investment of European capital in India possibly had a positive effect in the sixteenth century. Chapter 2 (by Radhika Seshan) on Madras between 1650 and 1720 shows that the town was ‘thriving’ in these decades thanks to a rise in revenue, an effect of growth in trade, licence fees, and settlements. The income sources for these two chapters derive partly from maritime activities. By contrast, those for the next three come from an interior state, the Peshwa’s domain, in the late eighteenth century. The material shows very little change in the circumstances of ordinary workers and possibly even a decline in real wages between the 1780s and the early nineteenth century. This is a region with a strong and bureaucratic state and a lot of market activity. The economy was by no means isolated, and it was highly commercialised. And yet, wages were relatively low, and there was no tendency for it to grow (chapters 3 by Rekha Ranade, 4 by Surendra Arjun Shirsat, and 5 by Aanjali Soitkar Vekhande).

Chapter 6 (by Jan Lucassen) uses the large and rich body of economic statistics collected by an officer W. H. Sykes in the mid-nineteenth century to create a granular account of contemporary western Maharashtra. Its general conclusion on living standards is that ‘a long-term stagnation occurred from the late 18th to the mid-19th century’. Along with wages, the chapter supplies evidence-based discussions on occupational structure, population, urbanisation, and age at marriage, because Sykes, thankfully, had a curious mind and collected information on many things. The chapter does justice to that enterprise. Once again, the overall impression of these times is broadly negative, if mildly negative.

Chapters 6 and 7 are about a later period, mid-to-late-nineteenth century. Dhiraj Kumar Nite processes the wages of construction workers in western Maharashtra to show an improvement in the second half of the century, but the change was modest at best. The chapter employs the consumption basket method widely applied in the divergence studies to show that Indian workers remained below contemporary European workers in living standards. In chapter 7, Amal Shahid shows how nineteenth-century famine relief camps often reproduced stereotyped impressions of relief-seeking Indians.

Is it all adding up to something? Is there a historiographic breakthrough? There is. The book suggests, even if it does not decisively establish, a big observation on trends in levels of living—an almost 300-year stagnation in real earnings for most forms of unskilled and semi-skilled manual labour. If conditions changed, they changed in the twentieth century, not before. Although the Great Divergence debate and associated studies on international wage data motivate the book, some of its most interesting and surprising results—and there are several—are about inequality within India. Lucassen finds ‘the extreme difference that exists between the earnings of agricultural labour and non-agricultural labour’ striking (p. 214). ¹ The very low average age at marriage of girls (11 years) suggests a corresponding inequality between men and women in their ability to choose jobs away from home or bargain for wages. A sharp inequality existed in earning power between soldiers and lower civilian officers.

Interestingly, the findings on inequality make the original justification for the book a little shaky. International comparisons are based on some notion of average living standards or incomes, averaged over an entire country. Inequality tells us that the idea of an average does not make sense. The richness of its statistical resources and the observations on the regional economies based on these help Wage Earners in India overcome the divergence trap, a fixation with averages.