Minimum wages for domestic workers: impact evaluation of the Indian experience
Rohan Ravindra Gudibande and
World Development, 2020, vol. 130, issue C
What impact does minimum wage legislation have on wages and employment opportunities in an informal sector in a developing country? The paper answers this question in the context of minimum wage legislation for domestic workers in India over the period of 2004–2012. Combining, matching procedure with difference-in-difference estimation approach, supported by extensive robustness checks, the paper estimates both the short-run and the long-run impact of the legislation on real wages and employment. Results show a positive impact of the legislation on real wages in the shortrun, while there is limited evidence of this effect persisting in the long-run. Further, the legislation did not seem to have any impact at the extensive margin on the probability of being employed as a domestic worker over short or long run. Our analysis further reveals that the wages of majority of workers remain below the minimum wage. Available evidence from the ground, in line with theoretical predictions, point towards weak enforcement of the legislation as the potential driving factor of observed results. As India recently extended national level minimum wage for all workers, the paper provides a cautionary tale on the potential pitfalls of implementation of this legislation in informal sector and suggests some ways to overcome the same.
Keywords: Minimum Wages; Domestic Work; India; Informal Sector; Employment; Impact Evaluation; Wage Distributions; Decent Work (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
Working Paper: Minimum Wages for Domestic Workers: Impact Evaluation of the Indian Experience (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:130:y:2020:i:c:s0305750x20300693
Access Statistics for this article
World Development is currently edited by O. T. Coomes
More articles in World Development from Elsevier
Bibliographic data for series maintained by Catherine Liu ().