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Subcontracting Linkages in the Informal Manufacturing Sector in Uttar Pradesh

In: Development Challenges of India After Twenty Five Years of Economic Reforms

Author

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  • Udai Bhan Singh

    (Yunus Social Business Centre, Amity Business School, Amity University Rajasthan)

Abstract

The study examines the subcontracting dynamics of informal manufacturing enterprises in Uttar Pradesh using nationally representative NSSO data of non-agricultural enterprises between 2010 and 2016. The results show that the incidence of subcontracting has decreased in rural areas among own-account enterprises and establishment (2–5 worker) category but it has increased in urban areas among these enterprises during the study period. There is negligible evidence to show that workers are much more efficient and productive in firms involved in subcontracting as compared to non-subcontracted enterprises. Rather, the study found that subcontracted enterprises created more jobs than non-subcontracting ones. It also found that the gross value addition (GVA) per worker in more than three-fourth subcontracted enterprises is below notional income, which indicates that a majority of labour-intensive enterprises come into the subcontracting system only as means for survival.

Suggested Citation

  • Udai Bhan Singh, 2020. "Subcontracting Linkages in the Informal Manufacturing Sector in Uttar Pradesh," India Studies in Business and Economics, in: Nripendra Kishore Mishra (ed.), Development Challenges of India After Twenty Five Years of Economic Reforms, pages 261-277, Springer.
    • Handle: RePEc:spr:isbchp:978-981-15-8265-3_14
    DOI: 10.1007/978-981-15-8265-3_14
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    Cited by:

    1. Samar Kumar Mishra & Bimal Kishore Sahoo, 2022. "Subcontracting in Unorganized Manufacturing: A Mode of Survival or a Strategy of Growth?," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 65(4), pages 1029-1051, December.

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