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Why Generating Productive Jobs is Essential for Reducing Poverty in India: Evidence from Indian Regions

Author

Listed:
  • Abhijit Sen Gupta

    () (Asian Development Bank)

  • Vishal More

    () (Founder and Managing Partner, Intelink Advisors)

  • Kanupriya Gupta

    () (Asian Development Bank)

Abstract

We investigate the pattern of India’s growth during the last decade, and its implications for poverty reduction. In particular, we focus on the role played by generation of productive employment opportunities in reducing poverty. The paper is first of its kind in analysing these issues at a granular level by focusing on 9 major sectors of the economy and focusing at a sub-state level, as the large size of Indian states masks significant heterogeneity. We decompose overall productivity growth into sectoral productivity growth and productivity increases arising from workers moving into high-productivity sectors as well as from workers moving to sectors experiencing productivity growth. We find that while improving sectoral productivity is important for poverty reduction, there is a significantly stronger link between shift of workers into sectors witnessing productivity growth and poverty reduction. Thus, generating jobs in sectors witnessing productivity growth is vital to accelerate poverty reduction.

Suggested Citation

  • Abhijit Sen Gupta & Vishal More & Kanupriya Gupta, 2018. "Why Generating Productive Jobs is Essential for Reducing Poverty in India: Evidence from Indian Regions," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 61(4), pages 563-587, December.
  • Handle: RePEc:spr:ijlaec:v:61:y:2018:i:4:d:10.1007_s41027-018-0148-x
    DOI: 10.1007/s41027-018-0148-x
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Structural change; Poverty reduction; Reallocation effect; Labour productivity;

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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