The rapid expansion of European empires via the colonization of large parts of Asia, Africa and

the Americas, initiated in the 15

th
century, had has been an important feature of world history.
Colonialism, defined as the policy or practice of acquiring full or partial political control over
another country, occupying it with settlers, and exploiting it economically (Ziltener, 2013) has
been the focus of much debate amongst academia in recent years. With the twenty poorest
nations of the world all being ex-colonies, it becomes interesting to examine whether such
underdevelopment is actually caused by a history of colonial rule or is guided by extraneous
factors.
Literature stands divided as to the impact of colonialism on the politics, economics and micro-
management practices of the ex-colonies: one view emphasizes factors such as excessive
exploitation of colonies, drain of resources or the growth of a dependency complex to argue
that colonial rule has long-term negative eects on political and economic development (Frank
1978; Bagchi 1982). On the other hand, there is the view that resource endowments or area
characteristics are the major determining forces of long-term outcomes, and that colonial rule
plays only a minor part (Herbst, 2000). As to the role of institutions, Engermann and Sokoloff
(1997) argue that property rights institutions and legal systems created by colonial powers have
very long-term consequences.
POLITICAL IMPACT:
Lange (2004), analyzing the impact of British colonialism, argues that direct rule provided an
administrative structure based on formal rules and had a centralized legal-administrative
structure with a formal chain of command that linked the diverse state actors throughout the
colony to the central colonial administration in the metropole; indirect rule promoted local
despotism by allowing traditional rulers to be rent-seekers extraordinaire. As a result, the
colonial state in indirectly ruled colonies lacked the capabilities to implement policy outside of
the capital city and often had no option for pursuing policy other than coercion (Lange 2004).
One of the most problematic legacies of colonial domination resulted from the
instrumentalization of ethnolinguistic and/or religious cleavages. Many postcolonial societies
across Asia and Africa live with the by-products of colonial legacies: elitism and bureaucratic
structures which the populace and institutions (Alavi, 1972, 1990; Kennedy, 1984). Colonial
masters chose hand-picked courtiers and subservient civil, military and landed elites to control
the general public which was already divided on the basis of religion, ethnicity and language.
Since then religious and ethno-national intolerance continue to plague the national culture of
many post-colonial societies, including Pakistan (Jhatial, 2010). This is affirmed by Khilji
(2003).
ECONOMIC IMPACT: