Is Pro-Labor Law Pro-Women? Evidence from India
CERGE-EI Working Paper Series No. 488
49 Pages Posted: 16 Oct 2013 Last revised: 13 Jun 2015
Date Written: October 1, 2013
I study the effects of state-level differences in labor regulation on labor market outcomes of women in India. Using a representative sample of urban households from 2005, I ﬁnd that labor regulation has a large negative effect on women’s economic activity, mainly employment. My estimates suggest that a one standard deviation increase in the labor regulation measure decreases the probability of a woman being economically active by 3% to 4% — the implied decrease in female labor force is between 15% and 18%. The effects on men’s participation are around zero. I do not ﬁnd labor regulation to have a signiﬁcant effect on male wages or on the gender wage gap. Finally, labor regulation is associated with women having less say at home and a lower sex ratio.
Keywords: gender gap, labor regulation, India
JEL Classification: J16, J21, K31
Suggested Citation: Suggested Citation