“…Empirical work in the Indian context has explored the tendency of the informal firms to transition towards formal sector, growth potential of the informal firms and earning potential of informal workers, their determinants, and so forth, over various periods (Abraham, 2017; Basole et al, 2015; CSE, 2018; Kesar & Bhattacharya, 2020; Raj & Sen, 2016). However, there has been a dearth of work at a pan‐India level that explores the underlying dynamics of livelihood reproduction in the economy in detail, which may help to make better sense of how the process of persistence of the informal economy that the various competing strands have sought to explain plays out on the ground.…”
Section: Informality Dualism and Transformationmentioning
We examine the Indian economy during a peak period of high growth between 2005 and 2012 to analyse the nature and patterns of household‐level transitions across different sectors, characterised by varying degrees of formality/informality and various production structures and labour processes. We find that even within this brief period, there has been a huge volume of household‐level transitions across sectors. However, the overall economic structure, and its segmentations, has continued to be reproduced, along with a regeneration of ‘traditional’ non‐capitalist informal spaces. To ascertain the nature of household‐level transitions in terms of economic well‐being, we employ a counterfactual analysis. We find that majority of transitions in the economy have been ‘unfavourable’ in nature, with large proportion of households undergoing sectoral transitions that are not optimal for them, given their socio‐economic characteristics. Furthermore, the likelihood of ‘favourable’ versus ‘unfavourable’ sectoral transition, on average, significantly varies with household characteristics, some of which, like social caste, are structurally given and cannot be optimally chosen by households. Drawing upon this analysis, we reflect on the competing strands of literature that seek to explain the persistence of informality. Our analysis highlights the complexity of India's contemporary development trajectory, whereby the pre‐existing economic structure is reproduced, paradoxically, through a continuous reshuffling and reconstitution of economic spaces, accompanied by significant volume of ‘unfavourable’ household‐level sectoral transitions.
“…Empirical work in the Indian context has explored the tendency of the informal firms to transition towards formal sector, growth potential of the informal firms and earning potential of informal workers, their determinants, and so forth, over various periods (Abraham, 2017; Basole et al, 2015; CSE, 2018; Kesar & Bhattacharya, 2020; Raj & Sen, 2016). However, there has been a dearth of work at a pan‐India level that explores the underlying dynamics of livelihood reproduction in the economy in detail, which may help to make better sense of how the process of persistence of the informal economy that the various competing strands have sought to explain plays out on the ground.…”
Section: Informality Dualism and Transformationmentioning
We examine the Indian economy during a peak period of high growth between 2005 and 2012 to analyse the nature and patterns of household‐level transitions across different sectors, characterised by varying degrees of formality/informality and various production structures and labour processes. We find that even within this brief period, there has been a huge volume of household‐level transitions across sectors. However, the overall economic structure, and its segmentations, has continued to be reproduced, along with a regeneration of ‘traditional’ non‐capitalist informal spaces. To ascertain the nature of household‐level transitions in terms of economic well‐being, we employ a counterfactual analysis. We find that majority of transitions in the economy have been ‘unfavourable’ in nature, with large proportion of households undergoing sectoral transitions that are not optimal for them, given their socio‐economic characteristics. Furthermore, the likelihood of ‘favourable’ versus ‘unfavourable’ sectoral transition, on average, significantly varies with household characteristics, some of which, like social caste, are structurally given and cannot be optimally chosen by households. Drawing upon this analysis, we reflect on the competing strands of literature that seek to explain the persistence of informality. Our analysis highlights the complexity of India's contemporary development trajectory, whereby the pre‐existing economic structure is reproduced, paradoxically, through a continuous reshuffling and reconstitution of economic spaces, accompanied by significant volume of ‘unfavourable’ household‐level sectoral transitions.
“…Following the 17th ICLS conceptual framework on informal employment, National Commission on Employment in the Unorganised Sector (NCEUS, 2007, defined informal employment as 'of those working in unorganised enterprises or households, excluding regular workers with social security benefits, and workers in formal sector without any employment/social security benefits provided by the employers'. Therefore, given the multiplicity of the definition of the informal sector, informal workers in India can be considered as all the workers engaged in any sector without any social security benefit (Abraham, 2017). According to the International Labour Organization (ILO, 2011(ILO, -2012, around 92% of the manufacturing workers are engaged in the informal sector in India.…”
Section: Changes In the Location Pattern Of Formal And Informal Sectormentioning
This study analyses the impact of co-location between formal and informal manufacturing sectors on plant-level productivity. We employ a unique data obtained by merging plant-level data from Annual Survey of Industries (ASI 2011–2012) and Survey of Unorganised Manufacturing and Repairing Enterprises provided by National Sample Survey Office (NSSO 67th round). We find that formal and informal manufacturing plants gain from localisation. Further, co-location with informal enterprises has a positive impact on productivity of formal sector plants; however, we observe insignificant impact of co-location on informal sector enterprises. Additionally, we find evidence that informal sector enterprises benefit from industrially diversified regions. JEL Classifications: D24, R12, R3
“…Data limitations as well as considerable overlap between the provision of PF and other social security benefits motivate the adoption of PF as a proxy for social security benefits. For further discussion on the rationale and tenability of this assumption, see Abraham ().…”
Section: Informal Employment and Wage Structure In India – Definitionmentioning
confidence: 99%
“…Trends in Forms of Employment, Urban India, 1999–2000 to 2011–2012 Note : FE–formal employment, SE–self‐employment, IIE–informal employment in informal enterprises, IFE–informal employment in formal enterprises. Source : Abraham (). [Colour figure can be viewed at wileyonlinelibrary.com]…”
Section: Informal Employment and Wage Structure In India – Definitionmentioning
confidence: 99%
“…In terms of the demographic profile of workers in each type of employment, while SE and IIE are typically uneducated or undereducated, the IFE unlike their counterparts in informal enteprises, are comprised of a relatively larger share of educated individuals (Abraham, ). The recent trend of informalization in formal enterprises has also seen a growing engagement of women, with an accompanying decline in self‐employment among women.…”
Section: Informal Employment and Wage Structure In India – Definitionmentioning
The "alternative", "atypical" or "informal" workforce has grown in developed and developing countries alike. One of the more recent evolutions of informal employment has been of informal employment within formal enterprises. In the interest of flexibility and cost-reduction, many formal firms increasingly resort to hiring workers on a temporary or informal basis. Alongside, and perhaps, as a result of the persistence and pervasiveness of informal employment, issues relating to inequality have come to the fore. This paper is motivated by these two intertwining aspects of Indian labor market-informality and wage inequality. Using nationally representative sample data, the paper examines trends in wage inequality among various forms of informal workers, overlaying these findings with broader trends in inequality. Using a regression based inequality decomposition, the paper compares the sources of wage inequality across different employment groups and the reasons for differences in wage inequality.JEL Codes: J46, J31, J21
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