TY  - JOUR
AU  - Hasan,Rana
AU  - Mitra,Devashish
AU  - Ramaswamy,K.V.
TI  - Trade Reforms, Labor Regulations and Labor-Demand Elasticities: Empirical Evidence from India
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 9879
PY  - 2003
Y2  - August 2003
UR  - http://www.nber.org/papers/w9879
L1  - http://www.nber.org/papers/w9879.pdf
N1  - Author contact info:
Rana Hasan
E-Mail: rhasan@adb.org

Devashish Mitra
Department of Economics
The Maxwell School of Citizenship and
Public Affairs
133, Eggers Hall, Syracuse University
Syracuse, NY  13244
Tel: 315/443-6143
Fax: 315/443-3717
E-Mail: dmitra@maxwell.syr.edu
AB  - Using industry-level data disaggregated by states, this paper finds a positive impact of trade liberalization on labor-demand elasticities in the Indian manufacturing sector. These elasticities turn out to be negatively related to protection levels that vary across industries and over time. Furthermore, we find that these elasticities are not only higher for Indian states with more flexible labor regulations, they are also impacted to a larger degree by trade reforms. Finally, we find that after the reforms, volatility in productivity and output gets translated into larger wage and employment volatility, theoretically a possible consequence of larger labor-demand elasticities.
ER  -