Wage Inequality and Job Insecurity Among Permanent and Contract Workers in India: Evidence from Organized Manufacturing Industries
Since the early 1990s, the employment structure of organized manufacturing industries in India has undergone substantial changes with steep rise in the use of contract workers in place of permanent workers. This process has led to increased wage inequality, discrimination as well as concern of job insecurity in the labor market. The paper focuses on wage inequality between permanent and contract workers, since contract workers earn substantially lower wages than their counterparts. The study uses data at the individual level from a recent labor survey of organized manufacturing industries in the India. The lower wage earned by contract workers is largely due to cost cutting, rather than differences in labor productivity. The issue of job insecurity has been modeled in the form of a binary logistic model. The factors affecting job security are divided into productivity-related attributes such as level of education and skill, and institutional attributes such as labor market rules and regulations and union membership. Contrary to the general expectation, the study finds that permanent workers are more concerned regarding job insecurity than the contract workers.
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Volume (Year): VII (2008)
Issue (Month): 1 (January)
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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Almas Heshmati, 2003.
"Productivity Growth, Efficiency and Outsourcing in Manufacturing and Service Industries,"
Journal of Economic Surveys,
Wiley Blackwell, vol. 17(1), pages 79-112, February.
- Heshmati, Almas, 2000. "Productivity Growth, Efficiency and Outsourcing in Manufacturing and Service Industries," SSE/EFI Working Paper Series in Economics and Finance 394, Stockholm School of Economics, revised 18 Oct 2001.
- Heckman, James J. & Lochner, Lance John & Todd, Petra E., 2005.
"Earnings Functions, Rates of Return and Treatment Effects: The Mincer Equation and Beyond,"
IZA Discussion Papers
1700, Institute for the Study of Labor (IZA).
- Heckman, James J. & Lochner, Lance J. & Todd, Petra E., 2006. "Earnings Functions, Rates of Return and Treatment Effects: The Mincer Equation and Beyond," Handbook of the Economics of Education, Elsevier.
- James J. Heckman & Lance J. Lochner & Petra E. Todd, 2005. "Earnings Functions, Rates of Return and Treatment Effects: The Mincer Equation and Beyond," NBER Working Papers 11544, National Bureau of Economic Research, Inc.
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