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The argument of exploitation of women workers in the labour market notwithstanding, this article examines whether women in India are unable to participate fully in the labour market because they are required to combine their household activities with income yielding jobs. They are constrained to work in the neighbourhood of their residence (the location of the residence having been decided upon by male family members), and can access jobs only through informal contacts (which usually means they end up in jobs similar to those of the contact persons), both of which reduce their bargaining power considerably. The tendency for specialized activities to be concentrated in different geographic locations of a city further restricts the possibility of women workers being engaged in diverse jobs and thus aggravates the situation of an excess supply of labour in a particular activity. Constrained choice, limited contacts of women and physical segmentation of the labour market perpetuate forces that entrap women workers in a low-income situation with worse outcomes than those of their male counterparts. Consequently with greater intensity of work they still continue to receive low wages, while residual participation in the labour market restricts the possibilities of skill formation and upward mobility. All of these factors offer a substantive basis for policy recommendations. Development and Change 36(2): 291-316 (2005). # Institute of Social Studies 2005. Published by Blackwell Publishing, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main St.,