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Schooling, Informal Experience, and Formal Sector Earnings: A Study of Indian Workers

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  • Bibhas Saha
  • Subrata Sarkar

Abstract

This paper estimates an earnings function for male workers belonging to the Indian corporate sector. The model allows for differential rates of return to schooling and distinguishes tenure from total labor market experience. The rate of return to schooling is found to be low up to the junior level, increases significantly at the secondary and undergraduate levels, but sharply declines at the masters level. Seniority and firm‐specific factors are found to be important determinants of earnings. When years of unemployment and informal experience are incorporated, earnings of low‐education workers appear to be driven entirely by formal‐sector experience.

Suggested Citation

  • Bibhas Saha & Subrata Sarkar, 1999. "Schooling, Informal Experience, and Formal Sector Earnings: A Study of Indian Workers," Review of Development Economics, Wiley Blackwell, vol. 3(2), pages 187-199, June.
    • Handle: RePEc:bla:rdevec:v:3:y:1999:i:2:p:187-199
    DOI: 10.1111/1467-9361.00060
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    Cited by:

    1. López Mourelo, Elva & Escudero, Verónica, 2017. "Effectiveness of Active Labor Market Tools in Conditional Cash Transfers Programs: Evidence for Argentina," World Development, Elsevier, vol. 94(C), pages 422-447.
    2. Thi Hong Hanh Pham, 2022. "Shadow Economy and Poverty: What Causes What?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 20(4), pages 861-891, December.
    3. Jafarey, Saqib & Lahiri, Sajal, 2002. "Will trade sanctions reduce child labour?: The role of credit markets," Journal of Development Economics, Elsevier, vol. 68(1), pages 137-156, June.
    4. Olivier Bargain & Sumon Kumar Bhaumik & Manisha Chakrabarty & Zhong Zhao, 2009. "Earnings Differences Between Chinese And Indian Wage Earners, 1987–2004," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 55(s1), pages 562-587, July.
    5. Saqib Jafarey & Sajal Lahiri, 2005. "Food for education versus school quality: a comparison of policy options to reduce child labour," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 38(2), pages 394-419, May.

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