Growth and Elasticity of Employment in the Indian Agricultural SectorAn Empirical Exercise

The present empirical exercise tries to look at the growth rate of employment and the responsiveness of employment in agriculture and allied activities to the changes in total employment in the organized sector during pre- and post-economic reform periods, by estimating a demand function for employment with an interaction variable. The results of the exercise based on the time series data points from the 1970 to 2002 period, which illustrate that the differential growth rate of employment in agriculture and allied activities is negative, both in private and public organized sectors. The results also show that differential elasticity of employment in agriculture and allied activities in the public sector is positive but insignificant, showing the absence of shift in the magnitude of employment elasticity during the post-economic reform period. The differential elasticity of employment in agriculture and allied activities in the private sector and total organized sector is significantly negative during the post-reform period, showing the fact that reforms have deteriorated the employment opportunities in agriculture and allied activities in the Indian economy.