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Disadvantage And Discrimination In Self-Employment - Caste Gaps In Earnings In Indian Small Businesses

  • Ashwini Deshpande

    (Department of Economics, Delhi School of Economics, Delhi, India)

  • Smriti Sharma

    (Department of Economics, Delhi School of Economics, Delhi, India)

Using the 2004-05 India Human Development Survey data, we estimate and decompose the earnings of household businesses owned by Scheduled Castes and Tribes (SCSTs) and non-SCSTs across the earnings distribution. We find clear diferences in characteristics between the two types of businesses with the former faring signicantly worse. The mean de-composition reveals that as much as 55 percent of the caste earnings gap could be attributed to the unexplained component. Quantile regressions suggest that gaps are higher at lower deciles, providing some evidence of a sticky foor. Finally, quantile decompositions reveal that the unexplained component is greater at the lower and middle deciles than higher, suggesting that SCST-owned businesses at the lower and middle end of the conditional earnings distribution face greater discrimination.

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Paper provided by Centre for Development Economics, Delhi School of Economics in its series Working papers with number 236.

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Length: 39 pages
Date of creation: Feb 2014
Date of revision:
Handle: RePEc:cde:cdewps:236
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