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Is Pro-Labor Law Pro-Women? Evidence from India

  • Josef Montag

I study the effects of state-level differences in labor regulation on labor market outcomes of women in India. Using a representative sample of urban households from 2005, I find that labor regulation has a large negative effect on women’s economic activity, mainly employment. My estimates suggest that a one standard deviation increase in the labor regulation measure decreases the probability of a woman being economically active by 3% to 4%—the implied decrease in female labor force is between 15% and 18%. The effects on men’s participation are around zero. I do not find labor regulation to have a significant effect on male wages or on the gender wage gap. Finally, labor regulation is associated with women having less say at home and a lower sex ratio.

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Paper provided by The Center for Economic Research and Graduate Education - Economic Institute, Prague in its series CERGE-EI Working Papers with number wp488.

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Date of creation: Aug 2013
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Handle: RePEc:cer:papers:wp488
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