Replication data for: Nominal Wage Rigidity in Village Labor Markets

Principal Investigator(s):  View help for Principal Investigator(s) Supreet Kaur

Version:  View help for Version V1

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LICENSE.txt text/plain 14.6 KB 12/06/2019 12:19:PM

Project Citation: 

Kaur, Supreet. Replication data for: Nominal Wage Rigidity in Village Labor Markets. Nashville, TN: American Economic Association [publisher], 2019. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-12-06. https://doi.org/10.3886/E116163V1

Project Description

Summary:  View help for Summary This paper develops a new approach to test for downward wage rigidity by examining transitory shocks to labor demand (i.e., rainfall) across 600 Indian districts. Nominal wages rise during positive shocks but do not fall during droughts. In addition, transitory positive shocks generate ratcheting: after they have dissipated, wages do not adjust back down. Ratcheting reduces employment by 9 percent, indicating that rigidities distort employment levels. Inflation, which is unaffected by local rainfall, enables downward real wage adjustments—offering causal evidence for its labor market effects. Surveys suggest that individuals believe nominal wage cuts are unfair and lead to effort reductions.

Scope of Project

Subject Terms:  View help for Subject Terms rainfall shocks; wage rigidity; employment
JEL Classification:  View help for JEL Classification
      E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
      E31 Price Level; Inflation; Deflation
      J23 Labor Demand
      J31 Wage Level and Structure; Wage Differentials
      O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration
      O18 Economic Development: Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
      R23 Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics
Geographic Coverage:  View help for Geographic Coverage India
Time Period(s):  View help for Time Period(s) 1956 – 2009
Universe:  View help for Universe Randomly sampled households in India
Data Type(s):  View help for Data Type(s) survey data; census/enumeration data; observational data

Methodology

Data Source:  View help for Data Source World Bank India Climate and Agriculture Dataset, Agricultural Wages in India, National Sample Survey
Unit(s) of Observation:  View help for Unit(s) of Observation districts,

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V1 [2019-12-06]

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