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Global Monopsony, Contracting Practices and Labour Outcomes: A Study of Garment GVCs in India

Author

Listed:
  • Dev Nathan

    (Institute of Human Development)

  • S. Rahul

    (Tata Institute of Social Sciences)

  • Lakshmi Bhatia

    (Sustain Ability)

  • Rekha Chakravarthi

    (Tata Institute of Social Sciences
    Cividep India)

  • Pradeepan Ravi

    (Cividep India)

Abstract

This is a study of the contracting practices of lead firms, who are buyers of garments, in the global market. Based on a survey of garment manufacturers in three clusters in India it reveals the trend to falling margins, reduced lead times, etc. for these contracted suppliers. These contracting practices are shown to connect, often directly, with labour outcomes, such as low wages, high workloads and forced overtime, in supplier factories. Within a joint but differentiated responsibility between lead firms and garment manufacturers, it argues for the prime responsibility of lead firms to provide for adequate wages and reduce the pressure for forced overtime in supplier factories.

Suggested Citation

  • Dev Nathan & S. Rahul & Lakshmi Bhatia & Rekha Chakravarthi & Pradeepan Ravi, 2024. "Global Monopsony, Contracting Practices and Labour Outcomes: A Study of Garment GVCs in India," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 67(4), pages 993-1014, December.
    • Handle: RePEc:spr:ijlaec:v:67:y:2024:i:4:d:10.1007_s41027-024-00546-w
    DOI: 10.1007/s41027-024-00546-w
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    References listed on IDEAS

    as
    1. Manning, Alan, 2003. "The real thin theory: monopsony in modern labour markets," Labour Economics, Elsevier, vol. 10(2), pages 105-131, April.
    2. Dev Nathan, 2021. "From Monopoly to Monopsony Capitalism," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 64(4), pages 843-866, December.
    3. Nathan,Dev & Silliman Bhattacharjee,Shikha & Rahul,S. & Kumar,Purushottam & Dahagani,Immanuel & Singh,Sukhpal, 2022. "Reverse Subsidies in Global Monopsony Capitalism," Cambridge Books, Cambridge University Press, number 9781316512272, January.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Contracting practices; Monopsony; Wages; Garment industry; India;
    All these keywords.

    JEL classification:

    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
    • J58 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Public Policy
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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