Stages of Capital

Law, Culture, and Market Governance in Late Colonial India

Stages of Capital

Book Pages: 360 Illustrations: Published: January 2009

Author: Ritu Birla

Asian Studies > South Asia, History > Asian History, Postcolonial and Colonial Studies

In Stages of Capital, Ritu Birla brings research on nonwestern capitalisms into conversation with postcolonial studies to illuminate the historical roots of India’s market society. Between 1870 and 1930, the British regime in India implemented a barrage of commercial and contract laws directed at the “free” circulation of capital, including measures regulating companies, income tax, charitable gifting, and pension funds, and procedures distinguishing gambling from speculation and futures trading. Birla argues that this understudied legal infrastructure institutionalized a new object of sovereign management, the market, and along with it, a colonial concept of the public. In jurisprudence, case law, and statutes, colonial market governance enforced an abstract vision of modern society as a public of exchanging, contracting actors free from the anachronistic constraints of indigenous culture.

Birla reveals how the categories of public and private infiltrated colonial commercial law, establishing distinct worlds for economic and cultural practice. This bifurcation was especially apparent in legal dilemmas concerning indigenous or “vernacular” capitalists, crucial engines of credit and production that operated through networks of extended kinship. Focusing on the story of the Marwaris, a powerful business group renowned as a key sector of India’s capitalist class, Birla demonstrates how colonial law governed vernacular capitalists as rarefied cultural actors, so rendering them illegitimate as economic agents. Birla’s innovative attention to the negotiations between vernacular and colonial systems of valuation illustrates how kinship-based commercial groups asserted their legitimacy by challenging and inhabiting the public/private mapping. Highlighting the cultural politics of market governance, Stages of Capital is an unprecedented history of colonial commercial law, its legal fictions, and the formation of the modern economic subject in India.


“... [T]his study contributes well to a range of debates about the history of colonial law and its relation with capitalism. It also adds to current understandings of the role of family firms in South Asian economies in particular.” — Taymour Harding, South Asia Research

Stages of Capital is a historical study of law and legal arrangements, even much of it new and uncharted, and an illuminating account of colonial economic governance.” — G Balachandran, Reviews in History

Stages of Capital thus provides a deep dive into the subject of colonial market governance in India as negotiated through the Marwari even as it also presents the broader strokes of how the production of economic actors fits into the rise of certain kinds of capitalist practices, the development of gendered nationalist sentiments, and even contemporary global economic politics.”

— Julietta Hua, Law, Culture and the Humanities

“[E]conomic historians cannot fail to notice the relevance of the examples discussed. What the book calls the ‘secrecy’ of family firms will be called information asymmetry in another historiography. A close, if patient, reading of the book, therefore, will be eminently rewarding to all concerned with colonialism and law.” — Tirthankar Roy, Economic History Review

“Birla offers a stimulating tour of colonial capitalist modernity in India and Stages of Capital deserves a wide readership among both historians of colonial India and others interested in the issues of law and capitalism.” — Prasannan Parthasarathi, H-Asia, H-Net Reviews

“Birla’s book opens to us a fascinating world of the merchant communities of India, who survived and competed effectively with their British counterpart. The book brings together the intricate details of how these privileged communities sought to protect their spheres when challenged by a different cultural context. . . . There is much to learn from this book. The detail opens up further areas of debate and discussion on colonialism, property rights, and economic development.” — Bishnupriya Gupta, Journal of Economic History

“In this important study, Ritu Birla unpacks much of the argument and literature on the subject and explains, in this complex, carefully nuanced account, how the Marwaris, a significant community of vernacular capitalists organized in family firms, interacted with various incentives to establish market governance under colonial rule. . . .Readers of the Business History Review will benefit from her thoroughly reasearched, sophisticated account of the kinship capitalism of the Marwaris and its role in developing India’s economy and market structures.” — B. R. Tomlinson, Business History Review

“In this theoretically clever and eminently readable book, Birla . . . unfolds the processes by which a distinct type of ‘family firm’ was rendered illegitimate in colonial law for failing to uphold [the] distinction between the realms of private/family and public/market, and how it strategically managed these divisions to emerge as a ‘legitimate bearer of capital.’ . . . [Its] rich theoretical insights . . . are solidly backed by impressive empirical research . . . . Birla brilliantly brings what is traditionally read as the history of ‘family law’ to bear upon the history of the economy. Besides filling a surprising critical gap by providing a feminist-inspired reading of vernacular capitalism, Birla's analysis also allows for a rethinking of postcolonial analyses of modernity.” — Ishita Pande, Canadian Journal of History

“This smart, original book retells late colonial Indian history as a story about the interdependence of economic developments and legislative changes and the impact of that entwinement on nationalist politics itself.” — Antoinette Burton, The Historian

Stages of Capital is a masterfully written book in which Birla brings to bear extensive archival material and insights from social theory, critical legal theory, and postcolonial studies, to offer a sophisticated argument about the workings of colonial law and capitalism in India. . . . This truly interdisciplinary book will no doubt provide a point of engagement for future work in the area. The book is invaluable for legal historians and scholars working on South Asia and likely to be of interest to anyone interested in the study of law, markets, and capitalism.” — Prabha Kotiswaran, Law & Society Review

“[A] fascinating book. . . . Birla provides some important leads, which other scholars will undoubtedly begin to follow, and she deserves great credit for establishing the terrain of a subject likely to attract further research.” — David Washbrook, Law and History Review

“[An] ambitious, excitingly original work. . . . [T]his book brings together economics, law, and history in a powerful vision that shapes afresh our understanding of capitalism and colonialism.”
— Thomas R. Metcalf, Journal of Interdisciplinary History

“This is a groundbreaking book, in terms of its theoretical approach as much as its findings and insights. . . . While scholars of post-colonial studies have been criticised for focusing on text and discourse and the expense of material structures, Birla’s impressive study demonstrates how important capital was to the construction of western hegemonic power and notions of a colonial modernity. . . . As a call to colonial historians to ask new questions of existing archives, Stages of Capital is an exciting and inspiring intervention in the field.” — Eleanor Newbigin, Journal of Colonialism & Colonial History

“This remarkable and clever book turns capitalism inside out, revealing the little-studied colonial legal structures that shaped both market governance and the commercial tactics in India. By demonstrating how a major merchant community, the Marwaris, adapted to the tide of colonial legislation about business practices in the 1880s to 1920s, Ritu Birla breaks critical new ground for historians in search of a way into the cultural and institutional construct we call the economy.” — Priya Satia, Enterprise & Society

Ritu Birla’s thoroughly researched, historically informed and theoretically adventurous text is a welcome addition to the growing, though still relatively meagre, literature on the history of commercial laws in colonised states. . . . I unreservedly recommend this text to anyone interested in the dynamics of the colonising process and the manner in which colonised elites, such as the Marwaris in India, were, at least to some degree, able to resist and/or influence the outcomes of this process."   — Rob McQueen, Griffith Law Review

Stages of Capital is a triumph of learned and nuanced interdisciplinarity. ‘Stage’ as temporal metaphor undoes the great narrative of universal capital. ‘Stage’ as spatial metaphor illuminates the culture of market governance and community in the colonial theater of South Asia. Richly theoretical, provocatively empirical—an indispensable book.” — Gayatri Chakravorty Spivak, University Professor, Columbia University

“Deeply rooted in precolonial pasts and yet somehow fully modern, family firms have remained an important but understudied feature of Indian capitalism. Ritu Birla’s book breaks new ground by analyzing the legal and institutional debates that attended maneuvers by the British to manage and transform this institution into the modern capitalist enterprise. A sophisticated and original study of some critical cultural issues in the history of Indian economy, this book will interest all students of modern India.” — Dipesh Chakrabarty, Lawrence A. Kimpton Distinguished Service Professor of History, South Asian Languages and Civilizations, and the College, University of Chicago

“This remarkable book shows that the history of colonial capitalisms need not, and cannot, be divorced from subtle changes in ideas of legal subjectivity, gender, and corporate risk taking as subjects of archivally based cultural analysis. Ritu Birla’s story of the transformation of the Marwari business clans of northern and eastern India into giants of contemporary capitalism is both impeccably scholarly and resolutely post-Orientalist. This book is a must for all those who sense that the mammoth global meltdown of this decade is powered by myriad regional and cultural capitalist trajectories.” — Arjun Appadurai, Goddard Professor of Media, Culture, and Communication, New York University


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Author/Editor Bios Back to Top

Ritu Birla is Associate Professor of History at the University of Toronto.

Table of Contents Back to Top
Acknowledgments ix

Introduction 1

Part 1. A Non-Negotiable Sovereignty?

1. The Proper Swindle: Commercial and Financial Legislation of the 1880s 33

2. Capitalism's Idolatry: The Law of Charitable Trusts, Mortmain, and the Firm as Family, c. 1870-1920 67

3. For General Public Utility: Sovereignty, Philanthropy, and Market Governance, 1890-1920 103

Part 2. Negotiating Subjects

4. Hedging Bets: Speculation, Gambling, and Market Ethics, 1890-1930 143

5. Economic Agents, Cultural Subjects: Gender, the Joint Family, and the Making of Capitalist Subjects, 1900-1940 199

Conclusion: Colonial Modernity and the Social Worlds of Capital 232

Notes 239

References 307

Index 329
Sales/Territorial Rights: World

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Winner, 2010 Albion Book Prize, presented by the North American Conference on British Studies

Additional InformationBack to Top
Paper ISBN: 978-0-8223-4268-7 / Cloth ISBN: 978-0-8223-4245-8
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