Despite the centralised nature of the fiscal system in colonial India, public education expenditures varied dramatically across regions with the western and southern provinces spending three to four times as much as the eastern provinces. A significant portion of the inter-regional difference was due to historical differences in land taxes, an important source of provincial revenues in the nineteenth and early twentieth century. The large differences in public spending, however, did not produce comparable differences in enrolment rates or literacy in the colonial period. Nonetheless, public investments influenced the direction of school development and perhaps the long run trajectory of rural literacy.
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