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Seasonality and Wage Responsiveness in a Developing Agrarian Economy

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  • Sunil Kanwar

Abstract

This paper studies the wage responsiveness of labour supply and demand, simultaneously addressing the twin issues of the non-clearing of developing rural labour markets and seasonality. It employs a data set pertaining to south-central India, and limits itself to the agricultural market for daily-rated labour (by far the predominant form of wage contract in the sample villages). Estimating a theoretically robust and empirically justified disequilibrium model of the agricultural labour market, we find no evidence of backward-bending supply curves or 'vertical' demand curves, contrary to findings in the literature. Further, while the agricultural labour market appears to be in equilibrium during the kharif (or rainy) season, it manifests excess supply in the rabi (or post-rainy) season. Copyright 2004 Blackwell Publishing Ltd.

Suggested Citation

  • Sunil Kanwar, 2004. "Seasonality and Wage Responsiveness in a Developing Agrarian Economy," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 66(2), pages 189-204, May.
  • Handle: RePEc:bla:obuest:v:66:y:2004:i:2:p:189-204
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    Cited by:

    1. Bardasi, Elena & Wodon, Quentin, 2006. "Poverty Reduction from Full Employment: A Time Use Approach," MPRA Paper 11084, University Library of Munich, Germany.
    2. Wodon, Quentin & Beegle, Kathleen, 2006. "Labor Shortages Despite Underemployment? Seasonality in Time Use in Malawi," MPRA Paper 11083, University Library of Munich, Germany.
    3. Murgai, Rinku & Ravallion, Martin, 2005. "Is a guaranteed living wage a good anti-poverty policy?," Policy Research Working Paper Series 3640, The World Bank.
    4. Kanika Mahajan & Bharat Ramaswami, 2017. "Caste, Female Labor Supply, and the Gender Wage Gap in India: Boserup Revisited," Economic Development and Cultural Change, University of Chicago Press, vol. 65(2), pages 339-378.

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