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The Effects of Labor Regulation on Firms and Exports: Evidence from Indian Apparel Manufacturing
Journal of Comparative Economics ( IF 2.8 ) Pub Date : 2020-07-01 , DOI: 10.1016/j.jce.2020.04.007
Rana Hasan , Aashish Mehta , Asha Sundaram

Abstract We examine the impact of labor regulations on firm outcomes and explore their differential effects on exporters. Building on a conceptual framework developed from standard theory and a detailed qualitative study of India's apparel industry, our econometric analysis exploits establishment-level data on formal Indian garment manufacturers between 2009-10 and 2013-14 and interstate variation in labor laws. We find a close fit between the implications of our conceptual framework, the qualitative evidence and the data. Apparel producers in states with pro-worker labor regulations tend to replace labor with capital. This choice of technique effect is smaller for exporting firms, which are more tightly bound to norms for organizing production in global supply chains. Pro-worker labor regulations also reduce output levels more for exporters than for non-exporters, consistent with exporters being bound to international pricing norms. Labor regulations thus have a particularly adverse impact on exporters. Our findings underscore the cost of poorly-designed and implemented labor regulations in a labor-abundant country wishing to spur exports, employment and industrial activity in labor-intensive industries.

中文翻译:

劳工管制对企业和出口的影响:来自印度服装制造业的证据

摘要 我们研究了劳动法规对企业成果的影响,并探讨了它们对出口商的不同影响。我们的计量经济学分析建立在从标准理论发展而来的概念框架和对印度服装行业的详细定性研究的基础上,利用了 2009-10 年至 2013-14 年间印度正规服装制造商的企业级数据以及州际劳动法的变化。我们发现我们的概念框架的含义、定性证据和数据之间非常吻合。有支持工人劳动法规的州的服装生产商倾向于用资本代替劳动力。对于出口公司而言,这种技术选择效应较小,它们与全球供应链中组织生产的规范更紧密地联系在一起。与非出口商相比,亲工人劳工法规对出口商的产出水平降低幅度更大,这与出口商受国际定价规范的约束相一致。因此,劳动法规对出口商产生了特别不利的影响。我们的研究结果强调了在一个希望刺激劳动密集型产业的出口、就业和工业活动的劳动力丰富的国家,劳动法规设计和实施不当的成本。
更新日期:2020-07-01
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