Labor regulation and employment in India's retail stores
A new dataset of 1,948 retail stores in India shows that 27 percent of the stores find labor regulations as a problem for their business. Using these data, author analyzes the effect of labor regulations on employment at thestore level. The author foound that flexible labor regulations have a strong positive effect on job creation. The author estimates show that labor reforms are likely to increase employment by 22 percent of the current level for an average store. The author also addresses the issue of informality in India's retail sector. The author findings suggest that more flexible labor laws can encourage firms to operate in the more efficient formal retail sector. According to author estimates, labor reforms can reduce the level of informality by as much as 33 percent.
|Date of creation:||01 Jun 2008|
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