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Asymmetric effects of gross capital formation, foreign technology spillover and profit on employment in extractive industry: case evidence from nonmetallic mineral industries in India

Author

Listed:
  • Arumugam Sankaran

    (Pondicherry Central University)

  • Arjun Krishna

    (Pondicherry Central University)

  • Salini Kunnath

    (Dr Johnmatthai Centre)

Abstract

The current research investigates the pros and cons of the nonmetallic extractive mineral industry on the number of workers premised on theoretical propositions of the resource blessing resource curse. As it is a time-series study based on data from 1981 to 2019, we have used both ARDL (Autoregressive Distributed Lag) and NARDL (Nonlinear Autoregressive Distributed Lag) methods of cointegration to extract linear and nonlinear long-run ties among the variables. The cases of gross capital formation and technology spillover (proxied by oil consumption) positively impacted the number of workers. It implies that investments in the extractive resource industry proved formidable in employment generation while foreign technology penetration also proved favourable. It suggests either neutral technical progress or labour-saving technological progress in vogue. In addition, it implies that resource-based industries are a boon to the nation, as exemplified by the positive impact on workers, and hence, it outweighs resource curse theories. Even though the production technique is labour-augmenting, it doesn’t mean it would reduce absolute labour intake. It would help to increment labour intake by expanding production and the range of products.

Suggested Citation

  • Arumugam Sankaran & Arjun Krishna & Salini Kunnath, 2024. "Asymmetric effects of gross capital formation, foreign technology spillover and profit on employment in extractive industry: case evidence from nonmetallic mineral industries in India," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 37(4), pages 809-825, December.
    • Handle: RePEc:spr:minecn:v:37:y:2024:i:4:d:10.1007_s13563-024-00416-3
    DOI: 10.1007/s13563-024-00416-3
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    More about this item

    Keywords

    NARDL; Extractive industry; Technological spillover; Technical progress;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General

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