Changing Wage Structure in India in the Post-Reform Era [electronic resource] : 1993-2011. / Jacoby, Hanan G.
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TextPublication details: Washington, D.C. : The World Bank, 2015Description: 1 online resource (30 p.)Subject(s): Economic theory & research | Labor demand | Labor markets | Labor policies | Labor supply | Macroeconomics and economic growth | Markets & market access | Poverty reduction | Rural poverty reduction | Rural wages in india | Social protections and laborAdditional physical formats: Jacoby, Hanan G: Changing Wage Structure in India in the Post-Reform Era: 1993-2011Online resources: Click here to access online Abstract: This paper documents the changing structure of wages in India over the post-reform era, the roughly two-decade period since 1993. To investigate the factors underlying these changes, a supply-demand framework is applied at the level of the Indian state. While real wages have risen across India over the past two decades, the increase has been greater in rural areas and, especially, for unskilled workers. The analysis finds that, in rural areas, the changing wage structure has been driven largely by relative supply factors, such as increased overall education levels and falling female labor force participation. Relative wage changes between rural and urban areas have been driven largely by shifts in employment, notably into unskilled-intensive sectors like construction.
This paper documents the changing structure of wages in India over the post-reform era, the roughly two-decade period since 1993. To investigate the factors underlying these changes, a supply-demand framework is applied at the level of the Indian state. While real wages have risen across India over the past two decades, the increase has been greater in rural areas and, especially, for unskilled workers. The analysis finds that, in rural areas, the changing wage structure has been driven largely by relative supply factors, such as increased overall education levels and falling female labor force participation. Relative wage changes between rural and urban areas have been driven largely by shifts in employment, notably into unskilled-intensive sectors like construction.
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