Skills, Informality, and Development

This paper makes an attempt to estimate the index of informal sector employment which can be attributed to the supply-push phenomenon. Factors which explain the inter-state variations include the industrial-informal sector wage gap, revenue expenditure, and development expenditure incurred by the government. Increased development expenditure brings in a decline in distress-led informalization. With improved education, health, and infrastructure facilities the employability of an individual goes up, which, in turn, reduces the compulsion to get absorbed residually. However, expansion in government activities measured through increased revenue expenditure raises in-migration, which in turn raises the supply-push phenomenon. We also observed that with an increase in distress-led informalization inequality tends to rise. Adoption of labour intensive technology in the organized industrial sector is indeed crucial for pro-poor growth. The other policy implication is in terms of enhanced investment in the areas of education, health and other infrastructural facilities.Informal sector, supply-push, development expenditure, stochastic frontier

Globalization, Growth and Poverty in India

globalization, economic growth, poverty, inequality, population shift effect, decomposition, India

Homelessness in France: Labour market implications

This paper analyses homelessness in France with regard to three major mutually interacting sets of factors: labour-market strains, illegal migration and institutional inadequacy. Macroeconomic challenges have resulted in the loss of jobs and subsequent labour-market hardships, and these have tended to affect those without adequate skills. As a result, labour-market problems together with a lack of social capital and adequate housing at affordable prices, accompanied by insufficient institutional support, has resulted in increased homelessness. All of this indicates that there should be active government intervention in the housing market in order to create space for the relatively weaker section of the population in the growth process, which is often unequal. Another important issue is how to create jobs with positive growth in real wages because, without adequate purchasing power, simply providing housing would mean transferring poverty from one space to another

K. V. Ramaswamy (Edt.), Labour, Employment and Economic Growth in India

Book reviewThe volume comprises ten excellent pieces of research other than the editor’s introductory note. In spite of its thickness the richness makes an enjoyable read.

Total Factor Productivity and Technical Efficiency of Indian Manufacturing: The Role of Infrastructure and Information & Communication Technology

Drawing on a recent dataset of the Indian manufacturing industry for 1994 to 2008, this paper shows for eight sectors that core infrastructure and Information & Communication Technology (ICT) matter for Total Factor Productivity (TFP) and Technical Efficiency (TE).In the analysis, we use a range of advanced estimation techniques to overcome problems of non-stationary, omitted variables, endogeneity and reverse causality (such as System-GMM, panel cointegration and FMOLS). Estimation results suggest that the impact of core infrastructure is rather strong on TFP and TE (elasticity of 0.32 and 0.17 respectively), while the effect of ICT appears slightly smaller (0.12 and 0.08, respectively). This finding is of particular importance in the Indian context of infrastructure bottlenecks. It strongly supports the idea that a lack of infrastructure can hamper growth in developing countries. Our results also reveal that the impact of infrastructure and ICT varies among the industries. Interestingly, Transport Equipments, Metal & Metal Products and Textile, which are sectors relatively more exposed to foreign competition, are also found to be more sensitive to infrastructure endowment. This result can be extended to the Chemical industry for TE. This finding implies that improving core and ICT infrastructure would proportionally benefit more to these sectors, which could play a leading role in the competitiveness and the industrial growth of the Indian economy.infrastructure;Manufacturing Industry;India;Information and Communication Technology;total factor productivity;Technical efficiency

Rural to Urban Migration: A District Level Analysis for India

Based on the recent census data this paper analyses the district level rural to urbanmigration rates (both intra-state and the inter-state) among males and femalesseparately. Both the rates are closely associated irrespective of whether the migrants originate from the rural areas within the state or outside the state. This would suggest that women usually migrate as accompanists of the males. Though many ofthe relatively poor and backward states actually show large population mobility,which is primarily in search of a livelihood, the mobility of male population is also seen to be prominent in the relatively advanced states like Maharashtra and Gujarat. Rapid migration of rural females within the boundaries of the states is, however, evident across most of the regions. The social networks, which play an important role in the context of migration are prevalent among the short distance migrants and tend to lose their significance with a rise in the distance between the place of origin and destination though there are some exceptions to this phenomenon. Besides the north-south divide in theIndian context is indeed a significant phenomenon with a few exceptions ofmetropolitan cities. As regards the effect of factors at the place of destination, prospects for better job opportunities are a major determinant of male migration. Low castes and minority groups tend to pull migration through network effects. Among females also these effects are evidentthough with the inclusion of the male migration rate they become lesssignificant. Finally the paper brings out the policy implications

Migration and Wellbeing at the Lower Echelons of the Economy: A Study of Delhi Slums

This paper based on a primary survey of households (2004-05) in the slum clusters of Delhi examines whether migrants are likely to experience upward mobility in their place of destination or alternatively, if they merely transfer their poverty from rural areas to large cities. First, a simple bifurcation of population in terms of poor and non-poor sub-groups is examined along with the incidence of poverty across different categories of occupations and non-workers. Then, an explanation of the variations in per capita expenditure across households is provided, and a binomial logit model (poor/non-poor) is developed identifying the variables which raise (or reduce) the probability of being non-poor (or poor). Next, an estimate of the wellbeing (deprivation) index is derived from factor analysis of a large number of variables including demographic and economic aspects of households.Empirical findings suggest that while duration of migration and the wellbeing index do not have a definite relationship, migrant households who have been in the city for a very long time have a higher wellbeing index on average than those who migrated in the last ten years. This tends to support the view that migrants do not merely transfer rural poverty to urban areas, and further that population mobility yields improvement in the living standard, if only in the very long term. Implementation of "employment-cum-shelter" support schemes in the urban areas may contribute to their wellbeing

Agglomeration Economies in Japan: Technical Efficiency, Growth and Unemployment

This paper examines if the effects of agglomeration economies get manifested in technical efficiency and generate faster economic growth and higher (lower) levels of employment (unemployment). Using the prefecture level data for each of the two-digit groups of industries in Japan, the paper estimates region-specific technical efficiency index based on the stochastic frontier production function framework. The results of the factor analysis show that in most of the industry-groups (with a few exceptions) efficiency has a positive association with external scale variable(s). Though the relationship is not seen to be very strong, it would be equally erroneous to ignore the effect of agglomeration economies on efficiency. In the case of some of the light goods industries the agglomeration effect is relatively stronger. Further, economic growth varies positively with external scale variable(s) and unemployment rate tends to fall with respect to growth and concentration. All this tends to suggest that measures against industrial concentration may be counter-productive, particularly in the context of globalisation when countries are in dire need of raising productivity

Total Factor Productivity and Technical Efficiency of Indian Manufacturing: The Role of Infrastructure and Information & Communication Technology

Drawing on a recent dataset of the Indian manufacturing industry for 1994 to 2008, this paper shows for eight sectors that core infrastructure and Information & Communication Technology (ICT) matter for Total Factor Productivity (TFP) and Technical Efficiency (TE).In the analysis, we use a range of advanced estimation techniques to overcome problems of non-stationary, omitted variables, endogeneity and reverse causality (such as System-GMM, panel cointegration and FMOLS). Estimation results suggest that the impact of core infrastructure is rather strong on TFP and TE (elasticity of 0.32 and 0.17 respectively), while the effect of ICT appears slightly smaller (0.12 and 0.08, respectively). This finding is of particular importance in the Indian context of infrastructure bottlenecks. It strongly supports the idea that a lack of infrastructure can hamper growth in developing countries. Our results also reveal that the impact of infrastructure and ICT varies among the industries. Interestingly, Transport Equipments, Metal & Metal Products and Textile, which are sectors relatively more exposed to foreign competition, are also found to be more sensitive to infrastructure endowment. This result can be extended to the Chemical industry for TE. This finding implies that improving core and ICT infrastructure would proportionally benefit more to these sectors, which could play a leading role in the competitiveness and the industrial growth of the Indian economy.infrastructure, Manufacturing Industry, India, Information and Communication Technology, total factor productivity, Technical efficiency

Dimensions and determinants of upward mobility : a study based on longitudinal data from Delhi slums

This study based on two primary surveys of the same households in two different years (2007/08 and 2012) assesses the extent of inter-temporal change in income of the individual workers and makes an attempt to identify the factors which explain upward mobility in alternate econometric framework, envisaging endogeneity problem. It also encompasses a host of indicators of wellbeing and constructs the transition matrix to capture the extent of change over time at the household level. The findings are indicative of a rise in the income of workers across a sizeable percentage of households though many of them remained below the poverty line notwithstanding this increase. In fact, there is a wide spread deterioration in the wellbeing index constructed at the household level. Among several determinants of income rise two important policy prescriptions can be elicited. Inadequate education reduces the probability of upward mobility while education above a threshold level raises it. Savings are crucial for upward mobility impinging on the importance of asset creation. Views that entail neighbourhood spill-over effects also received validation. Besides, investment in housing and basic amenities turns out to be crucial for improvement in wellbeing levels