Digitising Historical Plant Level Panel Data on Labour Outcomes

This project seeks to digitise historical plant–level data on labour outcomes from India. In addition to monthly, plant–level data on various labour outcomes, these data contain unique plant identifiers, which can be combined with existing cross–section surveys of Indian manufacturing plants to obtain new panel data on Indian manufacturing plants for the 1980s and 1990s. Indian manufacturing surveys provide detailed plant–level data on labour outcomes by gender. However, a big limitation of these data is that time–invariant plant identifiers are not available for years prior to 1998. We address this gap by digitising data with uncensored plant identifiers. The panel data that we plan to construct will therefore open several avenues for rigorous empirical work on gender, growth, and labour markets in India.

After the digitisation of this data, we will work to make the data freely available to researchers on the data portal of the Labour Bureau, Government of India– the legal owners of this data. We would like to emphasise that these data are from 1980s and 1990s when India was a very poor country, with a per capita income ranging from less than $300 in 1985 to under $450 throughout our period of study. Policy lessons from India during this time are very relevant to the economic transition of low–income countries in Africa and Asia of today. Since the new data is central to this proposal and because its digitisation is likely to take several months, we introduce the data below. We will use the digitised ASI (India’s Annual Survey of Industries) part II data for this project.

The ASI has two parts: (1) Part I, which has been used widely in economics research, contains *annual* data on various plant–level data such as inputs used, products produced, assets, liabilities, and rich data on labour market outcomes by gender such as employment, wages, bonuses, and employee benefits and (2) Part II, which contains *monthly* data on the number of working days, mandays, absenteeism, layoffs, new hires, and retirement. ASI Part II has recently been made available only for very recent years with missing data for a number of years. We have obtained raw historical data of ASI Part II from the archives of India’s Labour Bureau, which we plan to digitise. These data are stored in over 175 magnetic tapes and 25 magnetic floppy disks that potentially contain ASI part II data from 1980–2005. The Labour Bureau does not have the equipment to read these tapes. There are several advantages and novel aspects of these Part II data: 1. These data contain uncensored, time–invariant plant identifiers which may be used to construct panel data of plants. These panel identifiers will also be useful to construct a panel of ASI Part I, for which panel IDs are available only from 1998. This would allow the construction of very long panel data of manufacturing plants (1980–present) with rich information on labour outcomes by gender. 2. This data will become an important public good that will support multiple research projects to study the evolution ender, growth, and labour markets in India.

This project seeks to understand how gender interacts with demand–side labour market frictions. We exploit an unstudied amendment to India’s labour laws (The Industrial Disputes Act (IDA), 1947) in 1982 that increased firing costs for large plants to provide novel evidence on the causal link between labour market distortions and the reallocation and organisation of labour in developing countries. Bandiera et al. (2022) illustrate that gender plays a crucial role in the nature and allocation of jobs over the arc of development. How does gender interact with demand–side labour market frictions mentioned above? To answer this question, we plan to study how labour market regulations may differentially impact men and women workers. The policy change provides us with an instrument for a (negative) labour demand shift. To the extent that women are discriminated in the labour market, we would expect that the policy–induced fall in labour demand would hurt women more, as firms may lay off more women than men as they re– optimize their equilibrium labour force. In 1976, the IDA was amended to add Chapter V–B that required firms employing 300 or more workers to obtain government permission for layoffs, retrenchments and closures. A further amendment in 1982 (which took effect in 1984) expanded its ambit by reducing the threshold to 100 workers. India’s IDA has been the subject of many important papers such as Besley and Burgess (2004). Most of these papers study aspects of the IDA that originate from the 1976 and 1982 amendments. With novel historic ASI data covering this period, we hope to provide the first direct causal evidence on the impact of IDA’s pro–worker amendments on plant–level labour and investment outcomes.