Convergence across castes

Viktoria Hnatkovska, Chenyu Hou and Amartya Lahiri

MPRA Paper from University Library of Munich, Germany

Abstract: India has witnessed a remarkable catch-up by the historically disadvantaged scheduled castes and tribes (SC/STs) towards non-SC/ST levels in their education attainment levels, occupation choices as well as wages during the period 1983-2012. Using a heterogenous agent, multi-sector model we show that sectoral productivity growth during this period can explain 75 percent of the observed wage convergence between the castes. Inter-sectoral net flows of workers are key as they account for 3/4 of the predicted convergence. Absent these net flows, the caste wage gaps would have marginally widened. Selection effects, while present in these net flows, account for just a quarter of the predicted wage convergence. We also find that affirmative action policies that reduced skilling costs for SC/STs may have reduced the levels of the caste wage gaps at all times but played a limited role in accounting for the dynamics of the wage gap. Growth was key for the dynamic wage convergence.

Keywords: Castes; convergence; labor (search for similar items in EconPapers)
JEL-codes: J6 O1 (search for similar items in EconPapers)
Date: 2021-07-14
New Economics Papers: this item is included in nep-dev and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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