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Unemployment Burden and its Distribution: Theory and Evidence from India

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  • Sripad Motiram

    (Indira Gandhi Institute of Development Research)

  • Karthikeya Naraparaju

    (Indira Gandhi Institute of Development Research)

Abstract

We develop a measure of unemployment that takes into account both the level and intensity of unemployment and that satisfies several desirable properties, including distribution sensitivity (dealing with differences among the unemployed). It can also be decomposed into mean and distributional components and contributions to unemployment by various subgroups of the population. We then apply this measure to understand unemployment in India using data from National Sample Surveys on employment and unemployment during the period 1993-2012. We show that unemployment has generally fallen in this period, but this finding has to be seen in light of considerable underemployment. Moreover, unemployment is driven to a greater extent by higher educated groups; the unemployment among these groups is also fairly substantial. The distribution of unemployment has also worsened. We explain these findings and suggest some policies.

Suggested Citation

  • Sripad Motiram & Karthikeya Naraparaju, 2014. "Unemployment Burden and its Distribution: Theory and Evidence from India," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2014-026, Indira Gandhi Institute of Development Research, Mumbai, India.
  • Handle: RePEc:ind:igiwpp:2014-026
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    File URL: http://www.igidr.ac.in/pdf/publication/WP-2014-026.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Measurement of unemployment; Welfare costs of unemployment; Distribution;
    All these keywords.

    JEL classification:

    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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