Economic Growth, Structural Change and Productive Employment Linkages in India

Aradhna Aggarwal ()

South Asia Economic Journal, 2018, vol. 19, issue 1, 64-85

Abstract: This article presents a quantitative analysis of growth, structural change and employment linkages at the aggregate level and by sector under the state- and market-led regimes in India. The underlying objectives are: (a) to understand how economic liberalization has affected the economic and labour market structures, and linkages thereof; and (b) to analyse how these dynamics have affected the generation of productive employment in the economy. The analysis is based on Shapley decompositions. Our results suggest that the contribution of structural change in employment to growth declined drastically and secularly as the country transitioned to a high-growth regime driven by globalization. The sector-level analysis indicates that employment opportunities are not being created in high-productivity sectors and segments. Thus, despite a high-growth rate in GDP per capita and productivity-enhancing structural transformation in GDP, a vast population is still trapped in employment that cannot be qualified as productive employment. The study attributes it to trade-induced economic specialization accompanied with weakening of internal inter-sectoral linkages. The article makes a strong case for strategic government intervention to broad base structural change for generating productive employment, which is at the core of poverty reduction. JEL codes: E24, O14, O4

Keywords: Economic growth; globalisation; employment; Shapley decomposition; structural change; India (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/1391561418761074 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sae:soueco:v:19:y:2018:i:1:p:64-85

DOI: 10.1177/1391561418761074

Access Statistics for this article

More articles in South Asia Economic Journal from Institute of Policy Studies of Sri Lanka
Bibliographic data for series maintained by SAGE Publications ().