This paper investigates whether the industrial relations climate in Indian states has affected the pattern of manufacturing growth in the period 1958-92. We show that pro-worker ammendments to the Industrial Disputes Act are associated with lowered investment, employment, productivity and output in registered manufacturing. Regulating in a pro-worker direction is also associated with increases in urban poverty. This suggests that attempts to redress the balance of power between capital and labor can end up hurting the poor.

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Can Labor Regulation Hinder Economic Performance? Evidence from India

This paper investigates whether the effects, on registered manufacturing out-put,employment, entry and investment, of dismantling the 'license raj' - a system of centralcontrols regulating entry and production activity in this sector - vary across Indian stateswith different labor market regulations. The effects are found to be unequal depending onthe institutional environment in which industries are embedded. In particular, followingdelicensing, industries located in states with pro-employer labor market institutions grewmore quickly than those in pro-worker environments. Our results emphasize how localinstitutions matter for whether industry in a region benefits or is harmed by thenationwide delicensing reform.

The unequal effects of liberalization: evidence from dismantling the license Raj in India

Economic Crises and Natural Disasters: Coping Strategies and Policy Implications

Internal migration in developing countries

Effects of economic shocks on children's employment and schooling in Brazil

The 1990s have witnessed several financial crises, of which the East Asia and Mexico tequila crises are perhaps the most well-known. What impact have these crises had on labor markets, household incomes, and poverty? Total employment fell by much less than production declines and even increased in some cases. However, these aggregates mask considerable churning in employment across sectors, employment status, and location. Economies that experienced the sharpest currency depreciations suffered the deepest cuts in real wages, though deeper cuts in real wages relative to Gross Domestic Product (GDP) were associated with smaller rises in unemployment. To some extent, families smoothed their incomes through increased labor force participation and private transfers, though the limited evidence available suggests that wealthier families were better able to smooth consumption. The initial impact of the crises was on the urban corporate sector, but rural households were affected as well and in some instances suffered deeper losses than did urban families. School enrollment declined, especially among poorer families, as did use of health facilities, but the impact on children's nutrition levels appears to vary. Crises have typically proved short-lived, but whether households plunged into poverty during a crisis is able to recover as the economy does remain an open question.

/pdf/the-impact-of-financial-crises-on-labor-markets-household-rb58rn4dn4.pdf

The Impact of Financial Crises on Labor Markets, Household Incomes, and Poverty: A Review of Evidence

Job security regulations and the dynamic demand for industrial labor in India and Zimbabwe

Employment laws in India and Zimbabwe require employers to obtain permission from the government to retrench or lay off workers. The effect of these laws on the demand for employees in 64 manufacturing industries is examined using time series data. Little evidence is found indicating slower adjustments in employment levels and hence retardation in any structural adjustment following the new laws. However, in both countries a substantial decline in the demand for employees (other things equal) followed the new legislation. In Zimbabwe it is difficult to be precise about a causal connection between the drop in the demand for labor (allowing for concurrent increased wages) and the new legislation because enactment occurred simultaneously with Independence; however, the current economic climate induced high levels of investment in capital but not investments in long-term commitments to employees. But in India further evidence supports a causal connection: larger establishments covered by the job security regulations tended to experience a decline in the demand for labor while smaller, uncovered enterprises in the same industries did not; moreover the decline in demand for employees across industries in India was larger where the private sector predominates, where larger establishments covered by the new laws are important, and where a smaller proportion of employees are union members. Thus in both countries the policy implemented to protect jobs may bave resulted infarfewerjobs. Upon achieving independence in 1980, the government of Zimbabwe passed a new Employment Act, requiring employers to obtain permission from the Ministry of Labor to fire or lay off workers. Comparable regulations were imposed in India by the Industrial Disputes (Amendment) Act of 1976, requiring that written permission be obtained, normally from the relevant state government, either to close a plant or to retrench workers. The immediate goal of these items of legislation was to protect the livelihood of workers and to maintain jobs. Any addition to economic security in the lives of workers is clearly a laudable goal in its own right. But the question addressed in this article is whether these particular job security regulations have had undesirable side effects, which may even have thwarted the original goals of the legislation. India and Zimbabwe are

The Impact of Changes in Job Security Regulations in India and Zimbabwe

The 1990s have witnessed several financial crises, of which the East Asia and Mexico tequila crises are perhaps the most well known What impact have these crises had on labor markets, household incomes, and poverty? Total employment fell by much less than production declines and even increased in some cases However, these aggregates mask considerable churning in employment across sectors, employment status, and location Economies that experienced the sharpest currency depreciations suffered the deepest cuts in real wages, though deeper cuts in real wages relative to GDP were associated with smaller rises in unemployment To some extent, families smoothed their incomes through increased labor force participation and private transfers, though the limited evidence available suggests that wealthier families were better able to smooth consumption The initial impact of the crises was on the urban corporate sector, but rural households were affected as well and in some instances suffered deeper losses than d

The Impact of Financial Crises on Labor Markets, Household Incomes, and Poverty

Many people have questioned whether the world's poor share in economic growth. This note synthesizes the empirical evidence. The data show that economic growth typically reduces poverty and can usually be deemed pro-poor. But there is wide divergence across countries. In some cases the poor have gained relatively little from growth; in other cases they have benefited disproportionately. Available data may have weaknesses because most empirical studies of poverty are based on measures of income or consumption. But poverty is a state in which the quality of a person's life falls short of some recognized standard of well-being, and so it requires that additional dimensions be considered.

Peter R. Fallon

Papers

The Impact of Financial Crises on Labor Markets, Household Incomes, and Poverty: A Review of Evidence

Job security regulations and the dynamic demand for industrial labor in India and Zimbabwe

The Impact of Changes in Job Security Regulations in India and Zimbabwe

The Impact of Financial Crises on Labor Markets, Household Incomes, and Poverty

Empirics of the link between growth and poverty