Earnings and Caste: An Evaluation of Caste Wage Differentials in the Nepalese Labour Market

This paper examines the sources of wage differentials among castes in Nepal, a country which had, until 1963, an age-old caste-based social division of labour. We use an extended Oaxaca decomposition model with occupation and firm size augmenting the conventionally used measures of human capital endowments. Our results indicate that caste wage differentials in Nepal are large and that human capital endowments and lack of access to better paying occupations and larger firms have a significant impact. Furthermore, we find mixed evidence that the government policy of affirmative action has narrowed down the caste wage differential.     

The labour market in a dual economy: Another look at colonial Rhodesia

A labour market model is developed for the formal sector of a labour surplus economy, allowing for monopsony power by firm owners and an inelastic supply of labour with respect to the wage rate. This inelasticity arises even though the wage rate in the traditional sector may be ‘fixed’ due to surplus land, and the supply of labour to the traditional sector responds quite positively to an exogenous increase in the (implicit) wage rate there. This labour supply function is derived from a simple utility maximisation model incorporating the spatial aspects of temporary migration to the formal sector.     

The Invisibility of Wage Employment in Statistics on the Informal Economy in Africa: Causes and Consequences

Abstract

This article challenges the claim, along with the statistics that support it, that self-employment is by far the dominant employment status in the informal economy. The article begins by reviewing key insights from relevant literature on the informal economy to argue that conventional notions of ‘wage employment’ and ‘self-employment’, while unfit for capturing the nature and variety of employment relations in developing countries, remain central to the design of surveys on the workforce therein. After putting statistics on Tanzania’s informal economy and labour force into context, the analysis reviews the type of wage employment relationships that can be found in one instance of the informal economy in urban Tanzania. The categories and terms used by workers to describe their employment situation are then contrasted with those used by the latest labour force survey in Tanzania. The article scrutinises how key employment categories have been translated from English into Swahili, how the translation biases respondents’ answers towards the term ‘self-employment’, and how this, in turn, leads to the statistical invisibility of wage labour in the informal economy. The article also looks at the consequences of this ‘statistical tragedy’ and at the dangers of conflating varied forms of employment, including wage labour, that differ markedly in their modes of operation and growth potential. Attention is also paid to the trade-offs faced by policy-makers in designing better labour force surveys.     

Localising Globalisation: Gendered Transformations of Work in Emergent Economies

This introduction identifies central traits of the contemporary labour situation in emergent economies of the global South, and situates the articles for the special section within this broader context. The focus is on the ways changes in labour produce reconfigurations of gender and power relations, and on how local models of gender shape new forms of labour and emerging labour markets. The object of study is thus the complexities different forms of capitalist integration pose in specific socio-historical localities and moments where people’s ‘work membership’ in society is becoming actualised in new ways.     

Gender wage inequality and export‐led growth in South Korea

This article investigates the relationship between gender, wage inequality, and export‐led growth in South Korea. The persistent gender wage gap in Korea's manufacturing sector is found to be linked to women's segregation in the country's major export industries where real wage growth has lagged productivity growth, despite favorable market conditions that might drive up women's wages relative to those of men. The interaction of state‐ and firm‐level hiring, training, and promotion practices that structure women's and men's employment opportunities differently appear to have resulted in a relatively weaker fall‐back position for women in labour markets. Econometric results are consistent with the hypothesis that women's weaker fall‐back position limits their ability to bargain for wage increases commensurate with productivity growth. Further, evidence is presented which links gender wage inequality to the growth of Korean exports.     

Minimum Wage Competition between Local Governments in China

The theory of fiscal and regulatory competition between jurisdictions is more advanced than its empirical testing. This is particularly true of labour regulation in general, and minimum wage regulation in particular, and especially so for developing countries. This paper utilises the spatial lag methodology to study city-level strategic interactions in setting and enforcing minimum wage standards during 2004–2012 in China. We manually collect a panel data set of city-level minimum wage standards from China’s government websites. This analysis finds strong evidence of spatial interdependence in minimum wage standards and enforcement among main cities in China. If other cities decrease minimum wage standards by 1 RMB, the host city will decrease its standard by about 0.7–3.2 RMB. If the violation rate in other cities increases by 1 per cent, the host city will respond by an increase of roughly 0.4–1.0 percentage points. The results are robust to using three estimation methods, Maximum Likelihood, IV/GMM, and a dynamic panel data model. Our findings of strategic interactions suggest the need for policy coordination in labour regulation in China.     

Population growth and real wages of agricultural labourers in Bangladesh

A long‐run negative impact of population growth upon real wages is neither theoretically self‐evident nor, in the case of rural Bangladesh, empirically clear‐cut. In addition to its negative ‘labour supply effect’, population growth may have a positive ‘labour demand effect’ upon wages. The latter may help to explain why Bangladeshi districts with higher rural population densities have higher agricultural wages, and why districts with more rapid population growth in the first half of this century subsequently experienced slower‐than‐average real wage declines. An investigation of agricultural growth and agrarian structure as mediating variables in the population‐wage relation indicates that changes in average operational holding size, inequality of landholdings, and the extent and nature of tenancy contributed to this result.     

Agrarian reform and seasonal employment in coastal Peruvian agriculture

This article attempts (i) to estimate intra‐year casual labour supply functions (ICLSF) for single field tasks to selected agricultural production cooperatives in Northern Peru; (ii) to explain the marked seasonal variation in wage rates paid by these cooperatives to casual workers; (iii) to evaluate the relevance of minimum wage legislation for casual labourers on these enterprises, and (iv) to assess the degree of labour market integration both within and between production cooperatives. Two types of labour supply function were identified: (a) perfectly elastic at the minimum wage, and (b) kinked ICLSF. Wage rates set in the cooperative's external labour market affect wage determination in its internal labour market. The casual labour markets in two valleys were found to be poorly integrated.     

Adjustment,stabilisation and the structure of employment in Brazil

A significant change in the structure of employment in Brazil in the period 1988–95 took place. Industrial employment fell, especially in the most traditional sectors such as clothing, textiles and footwear. There has been a shift of workers from the industrial sector to the services sector and an increase in the share of self‐employed workers and informal wage earners. The quality of jobs being created in the services sector are not of the same ‘quality’ as those in the industrial sector, leading to a deterioration of employment conditions and of the labour market performance. Hence the rate of unemployment is not a very good measure of labour market conditions during adjustment. The creation of jobs in general might therefore not be an explicit target under adjustment. Rather the objective should be trying to change labour market institutions in order to improve the quality of the jobs and the quality of the labour relations.     

Wage – labour activities by agricultural households in Nicaragua

This article considers wage?–?labour activities by agricultural households in Nicaragua. It analyses the role of: (1) comparative advantage as determined by individual and household characteristics; and (2) agricultural conditions and market imperfections, in shaping wage?–?labour supply. An econometric specification is developed which allows for random household-specific effects. Results reveal that non-agricultural wage work is largely determined by comparative advantages, whereas agricultural wage work is used to deal with a number of agricultural conditions and market imperfections.     

The Cultural Logic of Work: Explaining Labour Deployment and Piece-Rate Contracts in Matar Taluka,Gujarat - Parts 1 and 2

This two-part essay seeks to explain why group-based and individual piecework arrangements have become the modal form of payment for a variety of agricultural tasks in central Gujarat, India. Part 1 of the essay reviews New Institutional Economics (NIE) and Marxist Political Economy (MPE) approaches to the labour process, and claims that while the 'efficiency' and 'disciplinary' considerations emphasized by NIE and MPE in their explanations of contractual change are important influences on the labour process, specific institutional outcomes depend heavily on the cultural realities of actors' practices. Part 2 challenges the epistemological assumptions of NIE and MPE narratives, specifically that agents with stable identities perform actions with fixed meanings. Instead, the recent surge in piecework employment must be viewed as part of an ongoing tussle between the dominant Lewa Patel caste and the subordinate Baraiya/Koli caste to alter their relative standings in the social order. Their unceasing attempts to reinvent their group identities have involved shifting understandings of 'work' - with direct implications for labour contracts. As a corrective to NIE and MPE, the essay proposes a semiotic approach to the labour process that bundles the notions of 'social regulation' and 'self-regulation' into the concept of 'work governmentality'.     

Do Female Gender Role Attitudes Affect Labour Market Participation in Egypt?

We analyse the inter-generational relationship of attitudes towards gender roles and their impact on individuals’ labour market participations in Egypt. We find a strong correlation between mothers’ and daughters’ perceptions of gender roles. Unlike the existing literature, perceptions are not associated with the labour market status even if we control for endogeneity issues using an instrumental variable regression. Furthermore, higher-educated females are more likely to be unemployed in Egypt. These results imply that perceptions among females are not translated into their labour market behaviour and the supply-side policies alone may not be sufficient for improving young women’s employment opportunities.     

Getting to the frontier

This article analyses a Stackelberg differential game in which households' labour supply and fertility decisions are taken assuming husbands as leaders and wives as followers. The model solution yields the optimal number of children and labour supply of male and female. In equilibrium male and female labour supply increases with wage and decreases with children costs and time preference, and the optimal number of children increases with male wage and decreases with cost of children, husband's time preference, and female's wage and time preference. We test the model using Ghana Living Standard Survey Round 4 and find that women are more sensitive to changes in the labour market conditions than males, and better labour market opportunities for women may lead to a strong reduction in fertility.     

Gender,Land and Sexuality: Exploring Connections

This article explores links between the issues of sexuality and gendered control over agricultural land. It discusses gendered land rights in several settings, concentrating particularly on agrarian and land reforms. I argue that land redistribution in the “household” model, discussed for Chile and Nicaragua, tends to entrench male household and agricultural control. In contrast, more collective forms, discussed for Vietnam, have displayed economic weaknesses but had potential to undercut such control by socialising women’s labour. Fears about and visions of female sexuality have much to do with backlashes against inclusion of women, either through allowing them membership of cooperatives and collectives or through granting rights such as joint titling to land. In sub-Saharan Africa, there currently exists much discussion of improving women’s control over agriculture and its products. These continue to meet opposition, despite female predominance in agriculture in the region. Thus, even though women work on the land in many societies, this does not give them any automatic “closeness” to nature or say within households. Control over women’s, especially wives’, labour within peasant households, is linked to the manner that their persons and their labour are bound up in this socio-economic form. The article also examines two feminist attempts to configure alternative agricultural forms: the case of a lesbian agricultural collective in the west of the USA and an Indian model of new female-centred households for single women. Heterosexuality as an institution and gender subordination more broadly, as the examples here indicate, have to do not only with sexual practices or identity but extend also to issues of labour and access to crucial resources.     

The Moroccan system of labour institutions: a class-based perspective

Abstract

The relevance of workers’ mobilisations in the 2011 Arab uprisings and – more recently – in the Algerian movement for democracy and social justice has encouraged a renewed interest in labour–state relations in the region. This article presents a class-based perspective on labour institutions, taking Morocco as a case study. In contrast to institution-based approaches, this research argues that it is problematic to treat the trade unions as analytical proxies for the working class, because this heuristic move conceals how class struggles – from below and from above – can transcend and transform labour institutions. The article proposes a framework to study labour–state relations, highlighting the relative autonomy of union officials from workers and vice versa. In this way, it shows how, in the neoliberal phase, the Moroccan state increased inducements to the unions while decreasing those to the workers and maintaining significant constraints on workplace organising. To use a simplified formulation, the regime included the unions to exclude the workers. In such a context of low union representativeness, the dangers of reducing the working class to the trade unions emerge clearly.     

Racing to the bottom: international trade without a social clause

Linking trade concessions to compliance with internationally recognised labour standards is referred to as a ‘social clause’. The social clause is usually depicted as causing division between the (rich) global North and the less-industrialised global South. This article shows, however, that there is diversity of opinion among the labour movements of the global South and that contemporary labour-intensive manufacturing pits countries of the South against one another. The article raises the possibility of a race to the bottom in labour standards, where workers cannot enjoy the fruits of growth because their employers and governments hold on to the competitive advantage of cheap labour. Consider competition between China and Mexico for the North American apparel market: despite enormous employment growth apparel workers have not enjoyed wage growth and their conditions are often appalling. The race to the bottom can be prevented by South–South agreement to honour labour standards.     

Education,Employment and Earnings of Secondary School and University Leavers in Tanzania: Evidence from a Tracer Study

This study uses a tracer survey of secondary school completers in Tanzania to analyse the impact of educational qualifications on labour market earnings. We show that the rates of return to the highest educational qualifications for wage employees are not negligible and, at the margin, provide an investment incentive. However, we find little evidence of human capital effects in the earnings determination process for the self-employment sector. Introducing controls for father's educational background and a set of school fixed effects designed to proxy for school quality and potential labour market network effects reduces the estimated rates of return to educational qualifications. A comparison of our results with the available evidence from other countries in the region suggest that, despite an extremely small secondary and university education system, the private rates of return to education in the Tanzanian wage employment sector are comparatively low.     

Common elements of efficiency wage theories: What relevance for developing countries?

Conventional labour economics argues that wages are determined by supply and demand and that the typical firm is a wage taker. Efficiency wage theories state that wages are endogenous to a firm's own optimising behaviour and that the wage rate determines the labour productivity. These theories raise questions regarding the effectiveness of expenditure‐reducing and expenditure‐switching adjustment policies. This article reviews the theoretical and empirical literature on efficiency wages. It examines alternative models, highlights the emphasis of empirical research towards industrial countries, and points out the need for a test based on the major implications of the theory.     

The ‘girl effect’: liberalism,empowerment and the contradictions of development

The ‘girl effect’ – the idea that investment in the skills and labour of young women is the key to stimulating economic growth and reducing poverty in the global South – has recently become a key development strategy of the World Bank, the imf, usaid and dfid, in partnership with corporations such as Nike and Goldman Sachs. This paper examines the logic of this discourse and its stance towards kinship in the global South, situating it within the broader rise of ‘gender equality’ and ‘women’s empowerment’ as development objectives over the past two decades. Empowerment discourse, and the ‘capability’ approach on which it is based, has become popular because it taps into ideals of individual freedom that are central to the Western liberal tradition. But this project shifts attention away from more substantive drivers of poverty – structural adjustment, debt, tax evasion, labour exploitation, financial crisis, etc – as it casts blame for underdevelopment on local forms of personhood and kinship. As a result, women and girls are made to bear the responsibility for bootstrapping themselves out of poverty that is caused by external institutions – and often the very ones that purport to save them.     

Terms of trade and class conflict in a computable general equilibrium model for Mexico

A computable general equilibrium model for Mexico is constructed in which class conflict over the distribution of the surplus is the principal determinant of the terms of trade. The model consists of seven social classes and eight productive sectors. Classes are distinguished as ‘fundamental’ or ‘subsumed’ according to whether their incomes are primarily determined by conscious class struggle or by the resulting system of relative prices. Flexible prices are assumed to clear markets for which non‐produced means of production, such as agricultural land, limit supply while output in the remaining sectors is determined by the level of effective demand. For the latter sectors, two theories of price formation are compared and are seen to differ radically in their implicit conception of the nature of class conflict. A ‘Keynes‐Kalecki’ closure is considered in which prices are determined by a fixed mark‐up on costs. This enables capitalists to protect themselves from incursions on the rate of profit due to labour militancy or state‐imposed terms‐of‐trade policy designed to favour peasants andlor the agrarian bourgeoisie. A second, ‘Marx‐Sraffian’ price closure constrains the economy to a wage‐profit‐terms‐of‐trade surface; where the economy conjuncturally resides on this surface depends upon the level of effective demand, wages and terms‐of‐trade policy. Various policy scenarios are investigated under both closures.