TY - JOUR
T1 - Labor tying
AU - Mukherjee, Anindita
AU - Ray, Debraj
N1 - Funding Information:
This work forms part of the first author's doctoral thesis, submitted to the Indian Statistical Institute. A first draft of the paper was written when Ray was at the Indian Statistical Institute, New Delhi. He would like to thank the I.S.I. for its support. For the current draft, Mukherjee's research was supported by a McNa-mara Fellowship, and by the Institute for Economic Development, Boston University. We thank Dilip Mookherjee and two anonymous referees for helpful comments.
Copyright:
Copyright 2014 Elsevier B.V., All rights reserved.
PY - 1995/8
Y1 - 1995/8
N2 - We study labor-tying in a competitive agricultural economy. The co-existence of seasonal fluctuations in income and imperfect credit markets suggests that tied contracts should dominate casual labor markets. However, empirical observation from India suggests that this is far from being the case, and indeed, that there is a declining trend in labor tying. We consider a model that permits deviations ex-post from mutually agreed implicit contracts. In equilibrium, casual labor markets are always active despite the presence of seasonality, and a variety of implications are derived that link economic growth, changing information flows, and the decline of labor tying over time.
AB - We study labor-tying in a competitive agricultural economy. The co-existence of seasonal fluctuations in income and imperfect credit markets suggests that tied contracts should dominate casual labor markets. However, empirical observation from India suggests that this is far from being the case, and indeed, that there is a declining trend in labor tying. We consider a model that permits deviations ex-post from mutually agreed implicit contracts. In equilibrium, casual labor markets are always active despite the presence of seasonality, and a variety of implications are derived that link economic growth, changing information flows, and the decline of labor tying over time.
KW - Agriculture
KW - Implicit contracts
KW - Labor tying
KW - Rural labor markets
KW - Seasonality
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U2 - 10.1016/0304-3878(95)00011-E
DO - 10.1016/0304-3878(95)00011-E
M3 - Article
AN - SCOPUS:0029510548
VL - 47
SP - 207
EP - 239
JO - Journal of Development of Economics
JF - Journal of Development of Economics
SN - 0304-3878
IS - 2
ER -