In his classic (1976) book, The Moral Economy of the Peasant, James C. Scott paints the following picture of the impact of colonialism on rural society in the region, focusing particularly on the case of Indochina.
Colonialism opened up South East Asian agriculture to the world market and new kinds of economic instability linked to world market forces. In the traditional local market, when there was a bad harvest, prices tended to rise, because there was a shortage of grain for sale. So peasant cash income from a bad harvest could be more or less the same as from a good harvest, because the price was much lower in a good year. But once local prices were set at levels determined by the world market, this stabilizing effect ceased to operate: prices could remain low locally when the harvest was bad. One of the major factors behind the agrarian rebellions of the 1930s in Southeast Asia was the falling international price of rice and its effects. At the same time, as small-holder and tenant agriculture became more commercialized, more and more of the costs of production had to be met in cash. Even small-holders had to rent draft animals and hire labour, and they also had to pay money taxes to the State and repay interest on money loans. In some regions, landlords were able to take control of more and more land, as small-holders had to become tenants and tenants became labourers because they couldn't pay their debts. In general, balancing the peasant budget became more and more difficult.
At first sight it would seem that these problems would be worst in regions where agricultural yields were most unstable: such regions would include those which had the most unreliable rainfall patterns, but they also include areas where irrigation systems are plagued by problems of flooding. Increasing integration into the world-market economy made variability in the harvest due to ecological reasons much more of a problem than it had been before. But it also constituted a problem in its own right, and peasants who lived in regions which were more stable ecologically also found themselves worse off.
The trouble was, firstly, that areas whose ecologies permitted high average yields and big agricultural surpluses were going to be most important in the development of commercial agriculture: they were most vulnerable to slumps in world-market prices in the sense that more of their production was commercial. Secondly, the more a region specialized in a single product destined for the world market rather than local consumption, the more vulnerable it would be to sudden slumps in prices. So the problem of prices was worst of all where there was a monocrop economy focussed on export: rice can at least be eaten locally, whereas products like rubber, sugar and tobacco are essentially export crops. Thirdly, areas where average yields and surpluses were most stable were also the areas where landlords and the State were going to extract most from the lower classes. When the international rice market went into depression in the 1930s, there was no corresponding reduction in the demands made on the peasant surplus by the landlords or the State. Here it's important to stress that integration into the capitalist world market put pressure on landlords as well as peasants. Their income was as much at the mercy of world market prices as that of the peasants.
Landlords often borrowed money, and a slump in prices could threaten their entire social position - their income could drop rapidly, the value of their landholdings could plummet, and creditors might foreclose on loans. So it's not surprising that landlords became less flexible and paternalistic towards their tenants: they too faced social ruin, though not, of course, starvation, when the market turned sour.
Now let's look at the other aspects of the impact of colonialism. Colonial governments wanted to promote the growth of commercial production: they saw traditional systems of land tenure as a barrier to what they conceived as 'agricultural modernization', or a more 'rational' exploitation of resources in pursuit of profit. So they supported the development of private property relations of the kind found in 'developed' western economies - what Eric Wolf called 'mercantile domain' in his 1966 book Peasants.. It's vital to see that the state's intervention in the economy was as important a cause of this kind of social change as 'market forces'. Sometimes the form of intervention was very direct: for example, in the Mekong Delta part of Cochinchina, the French colonial administration played a very direct role in dispossessing small holders, creating rice-growing estates by taking the land from the small-holders and giving it to Vietnamese whom they wished to reward for loyalty to the colonial regime. But the state's promotion of private property relations and commercial development also had various more indirect implications for peasant subsistence security and social relations within villages.
Pre-colonial village redistributive systems did not disappear, but they became less effective under colonial conditions. Firstly, a good deal of what had been village communal land was turned into private property, often controlled by absentee landlords, and so couldn't be redistributed to needy households. This was a characteristic pattern in 19th century Latin America too, where after Independence, Liberal governments came to power and abolished the communal land tenure held by Indian villages under the Spanish colonial regime. Again, these 'modernizing' governments thought communal land tenure was a barrier to agricultural growth and greater productivity, and that a private property system would encourage the 'enterprising' indian farmer to contribute to agricultural development. In Russia, the village commune was probably only partly undermined, though there's quite a debate about how much land remained available for redistribution by village communities by the end of the 19th century.
Secondly, more and more local resources were controlled by outsiders, such as absentee landlords and merchants living in cities, whilst well-to-do people in the village would receive the backing of the state authorities if they insisted on their private economic rights to land or repayment of debts: so the social pressure by the poor on the rich which had been one of the cornerstones of the traditional 'moral economy' became less effective. In the pre-colonial period, the regional and village economies had been more self-sufficient, and so the possibility of accumulating wealth depended primarily on local resources. As the wealth of village elites became more closely tied to their links with non-local elites, urban merchants and government agencies, they had less need to maintain their patron-client relations in the villages in the traditional way. Equally important was the fact that the State would defend them against any resistance on the part of the community to the new way of doing things.
Another important effect of colonial conditions was that peasant farmers lost access to a range of supplementary resources which had been an important element in 'making ends meet' in the precolonial period:
Many peasants had not been able to subsist from farming alone. In the colonial period, a lot of local petty trading and craft production opportunities were undermined by the penetration of cheap mass-produced consumer items from factories in the developed industrial capitalist countries. Cheap European machine made textiles replaced locally made cloth, for example. Improvements in transport systems made it possible for these cheap manufactures to reach remote villages.
Another important loss was the communal pastures and forests which peasant families had previously been able to use to supplement their incomes without cost. Colonial legal systems tended to turn everything into private property. People couldn't get free fire-wood or fish from the river any more, but had to buy them. This was true of both small-holders and tenants, who had previously often enjoyed 'free' use of landlord resources like pasturage or woods and now had to pay for them. The destruction of these secondary sources of income pushed many people into dependence on wage-labour, and reinforced the need to earn a higher cash income.
In general terms, in many regions the paternalism which had previously characterized landlord-tenant relations disappeared. It was replaced by a more impersonal and contractual, less flexible, sort of relationship. Scott shows that from the peasant point of view, the crucial question was how much would be left after payment of rent: would it guarantee subsistence? Under a sharecropping system based on 50-50 shares, both the cultivator and the landlord shared the risk. Under a fixed rent system, the landlord's return was guaranteed: the tenant could do better if it was a good year than under sharecropping, but might be left with no subsistence income in a very bad year. Under traditional systems of land tenure, the landlord had generally guaranteed the cultivator a minimum subsistence income. Under share-cropping systems, landlords could still decide to be lenient in enforcing the contract, and help the tenant out if he failed to produce enough to cover his subsistence. But colonialism tended to undermine this type of relationship.
In general, landlords became much less flexible about rent payments, and attempted to stabilize their incomes at the expense of the peasants. This reflected the way commercialization also put social pressure on the landlord class. But it also reflected a fundamental shift in the balance of power between landlord and peasant. We can sum up this change as follows:
landowners became stronger: (a) because landholding became increasingly unequal and private property rights were defended by the colonial state, so that the landlords were less worried about maintaining a local clientele of contented tenants; (b) because population, and pressure on resources, was growing, weakening the bargaining power of tenants and labourers; (c) because tenants increasingly needed to borrow money for production as well as consumption because of the changing conditions produced by greater integration into the world market
Tenants and labourers found themselves in a weaker position because of these factors, plus their loss of 'free' additional subsistence resources and the weakening of village redistribution mechanisms.
But there was one further crucial factor which exacerbated "the peasant dilemma": state taxation. The colonial state not only provided backing for the landlord class's increasing exploitation of the peasantry, but it added to the peasantry's problems by increasing its own demands on the peasant surplus. Pre-colonial states had not been efficient tax-collectors. The modern European type of state machine was much stronger than those of even the most centralized of the so-called 'Oriental Despotisms'. Colonial states generally insisted on getting their taxes, and had the coercive and bureaucratic-administrative means to ensure they collected them. They also tended to favour a fixed Head Tax (poll tax) type of system which took no account of the problems peasants had in years of bad harvests. The colonial regimes were, after all, in the business of exploiting other countries and ensuring that the costs of maintaining colonial administrations were met by the colonized rather than by their own tax payers. So, as Scott shows, colonial tax demands underlay a good deal of Southeast Asian peasant rebellion.
Nevertheless, different areas had somewhat different experiences. For example, there are some regions where landlordism was a relatively new phenomenon, produced by colonial colonization to develop new rice exporting areas: these areas of 'frontier' capitalism, like Lower Burma or parts of Cochinchina, tended to have the most extreme versions of the new 'capitalistic' class relations. 67% of households in Cochinchina were completely landless by the 1930s. Zones of colonization also lacked a tradition of communal village organization rooted in the past: the pioneer villages of frontier zones were more socially divided, that is more internally class differentiated (echoes of Lenin). Communal authority and redistributive institutions were much weaker than in the long-established communal peasant villages. In other areas, peasants tried to resist changes in 'traditional' customs, and had stronger communal institutions to "redistribute pain" and ameliorate subsistence crisis for the poorer families, though such resistance tended to mitigate or slow down change rather than stop it altogether.
Scott suggests that both types of village organization could produce peasant rebellions, but that the nature of the rebellions might differ in ways related to the differences in the internal social structure of the peasant community. More differentiated villages might display less community solidarity, depend more on outside leadership mobilizing the poorer peasants, and be more inclined to pursue what Scott calls outward-looking ideological objectives, i.e. participate in movements to overthrow the state and change society. Scott suggests that peasants whose social organization is more communitarian are less likely to divide on class lines, and more likely to pursue what he calls "traditionalist" or "millenial" types of revolts aimed at trying to reverse change rather than create a new type of society. He doesn't, however, consider this a hard and fast rule, or really pursue this line of argument in detail.
Economists like Gary Becker have, however, argued that the best way to explain any kind of human behaviour or institutions is to see them as the product of rational individuals pursuing their self-interest. This is a reassertion of what used to be called the "formalist" perspective in economic anthropology, but in a yet more more radical form. What many would see as a value-laden western cultural perspective now becomes the truth of scientific method in all social analysis. This kind of position can immediately be used to criticise Scott, and has been, by Samuel Popkin in a book called The Rational Peasant. Popkin argues that peasants should be seen as rational individual actors whose primary concern in political action is maximisation of individual gain. The charge that might be levelled against the "moral economy" model of Scott is that it is, as Mark Granovetter has put it, "oversocialised". Scott’s critics argue that he has distorted both pre-colonial and post-colonial realities by assuming that pre-colonial Indochinese peasants automatically and unconditionally obeyed habits, norms and customs based on a cultural codes of the "just and the fair". This makes their responses to colonial transformations look mechanical: peasant rebellion would be the result of a clash of total cultures and moral systems. Surely we should at least entertain the idea that Indochinese peasants responded differently to colonial domination according to their circumstances and that individuals would behave differently, in terms of what suited their interests? Whether or not this is a valid critique of Scott, it clearly is important to look in detail at local situations and patterns of variation in class relations and peasant responses to changing circumstances.