Caste, female labor supply and the gender wage gap in India: Boserup revisited

The gender wage gap is notable not just for its persistence and ubiquity but also for its variation across regions and countries. A natural question is how greater work participation by women matters to female wages and the gender wage gap. Within India, a seeming paradox is that gender differentials in agricultural wage are the largest in southern regions of India that are otherwise favorable to women. Boserup (1970) hypothesized that this is due to greater labor force participation by women in these regions. This is not obvious as greater female labor supply could depress male wage as well. Other factors also need to be accounted for especially since women have fewer opportunities for non-farm employment. This paper undertakes a formal test of the Boserup proposition. We find that differences in female labor supply are able to explain 55 percent of the gender wage gap between northern and southern states of India. The paper also finds thatwomen gain from greater non-farm employment, even if their direct participation in such activity is limited. This happens because of higher wages.