IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/114622.html
   My bibliography  Save this paper

Inter-industry Wage Differentials in Indian Manufacturing: Convergence or Persistence?

Author

Listed:
  • Tandon, Anjali

Abstract

From a labour perspective, wage rates are reflective of the market demand for different skills and the institutional structures. Also, wage rate is a better measure of the well-being of workers solely dependent on wage income. This paper notes persistent regularity in industry-level wage rates confirming the absence of a convergence behaviour. The stability of industry-level wage rates brings industrial reforms under scanner for their implications on worker welfare. Wage convergence could be inhibited by the inter-industry movement of workers. One way to counter the proliferation of low-wage employment can be improved inter-industry worker movement through better adaptability of workers.

Suggested Citation

  • Tandon, Anjali, 2021. "Inter-industry Wage Differentials in Indian Manufacturing: Convergence or Persistence?," MPRA Paper 114622, University Library of Munich, Germany, revised 2022.
    • Handle: RePEc:pra:mprapa:114622
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/114622/1/MPRA_paper_114622.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Lawrence F. Katz, 1986. "Efficiency Wage Theories: A Partial Evaluation," NBER Chapters, in: NBER Macroeconomics Annual 1986, Volume 1, pages 235-290, National Bureau of Economic Research, Inc.
    2. G. E. Boyle & T. G. McCARTHY, 1999. "Simple measures of convergence in per capita GDP: a note on some further international evidence," Applied Economics Letters, Taylor & Francis Journals, vol. 6(6), pages 343-347.
    3. Alan B. Krueger, 1993. "How Computers Have Changed the Wage Structure: Evidence from Microdata, 1984–1989," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(1), pages 33-60.
    4. William T. Dickens & Lawrence F. Katz, 1987. "Inter-Industry Wage Differences and Theories of Wage Determination," NBER Working Papers 2271, National Bureau of Economic Research, Inc.
    5. Mary Amiti & Donald R. Davis, 2012. "Trade, Firms, and Wages: Theory and Evidence," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 79(1), pages 1-36.
    6. Metcalf, David, 1999. "The Low Pay Commission and the National Minimum Wage," Economic Journal, Royal Economic Society, vol. 109(453), pages 46-66, February.
    7. Puja Vasudeva Dutta, 2007. "Trade Protection and Industry Wages in India," ILR Review, Cornell University, ILR School, vol. 60(2), pages 268-286, January.
    8. Per Krusell & Lee E. Ohanian & JosÈ-Victor RÌos-Rull & Giovanni L. Violante, 2000. "Capital-Skill Complementarity and Inequality: A Macroeconomic Analysis," Econometrica, Econometric Society, vol. 68(5), pages 1029-1054, September.
    9. Peter Gottschalk & Sheldon Danziger, 2003. "Wage Inequality, Earnings Inequality and Poverty in the U.S. Over the Last Quarter of the Twentieth Century," Boston College Working Papers in Economics 560, Boston College Department of Economics.
    10. Utsav Kumar & Prachi Mishra, 2008. "Trade Liberalization and Wage Inequality: Evidence from India," Review of Development Economics, Wiley Blackwell, vol. 12(2), pages 291-311, May.
    11. Daron Acemoglu, 2002. "Technical Change, Inequality, and the Labor Market," Journal of Economic Literature, American Economic Association, vol. 40(1), pages 7-72, March.
    12. William T. Dickens, 1986. "Wages, Employment and the Threat of Collective Action by Workers," NBER Working Papers 1856, National Bureau of Economic Research, Inc.
    13. Jayanthakumaran, Kankesu, 2010. "Economic Reforms and Income Convergence/Divergence in Regional India," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 45(1), pages 29-48.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wenxiao Wang & Christopher Findlay & Shandre Thangavelu, 2021. "Trade, technology, and the labour market: impacts on wage inequality within countries," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 35(1), pages 19-35, May.
    2. Thanos Fragkandreas, 2022. "Three Decades of Research on Innovation and Inequality: Causal Scenarios, Explanatory Factors, and Suggestions," Working Papers 60, Birkbeck Centre for Innovation Management Research, revised Feb 2022.
    3. Dupuy, Arnaud & Marey, Philip S., 2008. "Shifts and twists in the relative productivity of skilled labor," Journal of Macroeconomics, Elsevier, vol. 30(2), pages 718-735, June.
    4. Amiti, Mary & Cameron, Lisa, 2012. "Trade Liberalization and the Wage Skill Premium: Evidence from Indonesia," Journal of International Economics, Elsevier, vol. 87(2), pages 277-287.
    5. Lex Borghans & Bas ter Weel, 2008. "Understanding the Technology of Computer Technology Diffusion: Explaining Computer Adoption Patterns and Implications for the Wage Structure," Journal of Income Distribution, Ad libros publications inc., vol. 17(3-4), pages 37-70, September.
    6. Davide Consoli & Francesco Vona & Francesco Rentocchini, 2016. "That was then, this is now: skills and routinization in the 2000s," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 25(5), pages 847-866.
    7. Nico Voigtlaender, 2009. "Many Sectors Meet More Skills: Intersectoral Linkages and the Skill Bias of Technology," 2009 Meeting Papers 1136, Society for Economic Dynamics.
    8. Zietz, Joachim & Zhao, Xiaolin, 2009. "The short-run impact of the stock market appreciation of the 1980s and 1990s on U.S. income inequality," The Quarterly Review of Economics and Finance, Elsevier, vol. 49(1), pages 42-53, February.
    9. repec:spo:wpmain:info:hdl:2441/2ajduu0gqt9ho8h2tavbin6ops is not listed on IDEAS
    10. Lex Borghans & Bas ter Weel, 2008. "Understanding the Technology of Computer Technology Diffusion: Explaining Computer Adoption Patterns and Implications for the Wage Structure," Journal of Income Distribution, Ad libros publications inc., vol. 17(3-4), pages 37-70, September.
    11. Borghans, Lex & ter Weel, Bas, 2007. "The diffusion of computers and the distribution of wages," European Economic Review, Elsevier, vol. 51(3), pages 715-748, April.
    12. Corneo, Giacomo & Lucifora, Claudio, 1997. "Wage formation under union threat effects: Theory and empirical evidence," Labour Economics, Elsevier, vol. 4(3), pages 265-292, September.
    13. Feng, Shuaizhang & Xia, Xiaoyu, 2022. "Heterogeneous firm responses to increases in high-skilled workers: Evidence from China's college enrollment expansion," China Economic Review, Elsevier, vol. 73(C).
    14. Manik Kumar & Sweety Pandey, 2021. "Wage Gap Between Formal and Informal Regular Workers in India: Evidence from the National Sample Survey," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 13(1), pages 104-121, January.
    15. Ariell Reshef, 2013. "Is Technological Change Biased Towards the Unskilled in Services? An Empirical Investigation," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 16(2), pages 312-331, April.
    16. Fonseca, Tiago & Lima, Francisco & Pereira, Sonia C., 2018. "Understanding productivity dynamics: A task taxonomy approach," Research Policy, Elsevier, vol. 47(1), pages 289-304.
    17. Carlos Medina & Christian Posso, 2010. "Technical Change and Polarization of the Labor Market: Evidence for Brazil, Colombia and Mexico," Borradores de Economia 614, Banco de la Republica de Colombia.
    18. repec:hal:spmain:info:hdl:2441/2ajduu0gqt9ho8h2tavbin6ops is not listed on IDEAS
    19. Kaveri Deb & William R. Hauk, 2020. "The Impact of Chinese Imports on Indian Wage Inequality," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 63(2), pages 267-290, June.
    20. Cheng, Can & Luo, Jiayu & Zhu, Chun & Zhang, Shangfeng, 2024. "Artificial intelligence and the skill premium: A numerical analysis of theoretical models," Technological Forecasting and Social Change, Elsevier, vol. 200(C).
    21. Pablo Acosta, 2001. "Los determinantes de la desigualdad en los ingresos laborales: El rol de las nuevas tecnologías y la apertura comercial," IIE, Working Papers 034, IIE, Universidad Nacional de La Plata.
    22. John Carter Braxton & Kyle F. Herkenhoff & Jonathan Rothbaum & Lawrence Schmidt, 2021. "Changing Income Risk across the US Skill Distribution: Evidence from a Generalized Kalman Filter," Opportunity and Inclusive Growth Institute Working Papers 55, Federal Reserve Bank of Minneapolis.

    More about this item

    Keywords

    Convergence; wage rates; factory sector; non-factory sector; work-based credits; worker welfare;
    All these keywords.

    JEL classification:

    • J0 - Labor and Demographic Economics - - General
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:114622. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.