Labor regulations and contract labor use: Evidence from Indian firms

• 成果类型: Article
• 署名作者: Chaurey, Ritam
• 署名单位: State University of New York (SUNY) System; Binghamton University, SUNY
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2014.12.008
• 发表日期: 2015
• 页码: 224-232
• 关键词: firms; INDIA; Labor laws; Contract workers

摘要

Labor regulations in India differ by states and apply differently across types of laborers. The most restrictive laws make it harder to fire permanent workers for firms. However, these laws do not apply to workers hired through contractors (contract workers). Using firm-level data from India, I find that compared to firms in flexible labor regulations, those in more restrictive labor regimes hire more contract workers as a response to transitory local demand shocks. I find no differential response in hiring of permanent workers by firms faced with these shocks. This suggests that firms circumvent labor laws by hiring workers indirectly through contractors in the face of economic fluctuations. (C) 2014 Elsevier B.V. All rights reserved.