Indian Labour Law and its Impact on Unemployment, 1970-2006: A leximetric study
AbstractWe analyse a recently developed leximetric dataset on Indian labour law over the period 1970 to 2006. Indian labour law is seen to be highly protective of workers' interests by international standards, particularly in the area of dismissal regulation. We undertake a time-series econometric analysis to estimate the impact of the strengthening of labour laws on unemployment and industrial output in the formal economy. We find no evidence that pro-worker labour legislation leads to unemployment or industrial stagnation. Rather, pro-worker labour laws are associated with low unemployment, with the direction of causality running from unemployment and output to labour regulation.
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Bibliographic InfoPaper provided by ESRC Centre for Business Research in its series ESRC Centre for Business Research - Working Papers with number wp428.
Date of creation: Dec 2011
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Web page: http://www.cbr.cam.ac.uk/
slabour law; unemployment; India;
Find related papers by JEL classification:
- K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
- J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
- J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
- J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
- J83 - Labor and Demographic Economics - - Labor Standards - - - Workers' Rights
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-05-15 (All new papers)
- NEP-IUE-2012-05-15 (Informal & Underground Economics)
- NEP-LAB-2012-05-15 (Labour Economics)
- NEP-LAW-2012-05-15 (Law & Economics)
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