INDIAN AND EUROPEAN INDUSTRY 3 



facts are so numerous that it is only from a selection 

 of them that any definite meaning can be extracted, 

 and the very act of selection implies a theory. In the 

 succeeding chapters, therefore, I propose to recognise 

 the necessity of employing some theory about which 

 the evidence can be grouped, and for the most part I 

 shall make use of the familiar theories which have 

 been framed for European conditions of industry ; but 

 it must be borne in mind that these theories are for 

 India only tentative and provisional, and that they are 

 to be accepted only if they are found upon examina- 

 tion to be adequate explanations of the Indian facts. 



When the evidence has been collected and examined, 

 it will be possible to point out the exact difference 

 between the Indian and European type of industrial 

 organization. I do not think that this can be done 

 with profit now, but even in the present state of our 

 knowledge it is possible to point to certain broad re- 

 semblances and contrasts between the two types. I 

 do not think it can be maintained that there are 

 economic forces at work in the one which are in- 

 operative in the other. Thus, to take a specific 

 example, I do not think that competition is a force of 

 less importance in Indian than in European industry. 

 I cannot find any support for the opinion that competi- 

 tion is in India neutralized by custom. Undoubtedly 

 there is in India a great deal of what is known as 

 * economic friction,' impeding the operation of general 

 laws ; but in no country is economic friction abso- 

 lutely negligible, and when we compare the agricultural 

 classes of Europe with those of India, the difference 

 between them in this respect is not very remarkable. 

 At most, there is a difference in degree, and not in 

 kind. 



But if the economic forces are much the same in 

 India and Europe, there is the greatest difference 

 between the distribution of economic functions among 

 the various classes in one society and the other. To 



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