1st Edition
Labour and Capital Use in Indian Manufacturing Structural Aspects
This book strengthens our understanding of Indian manufacturing. It argues that structural transformation should be guided by the given factor endowments. The book undertakes detailed empirical scrutiny to provide inputs for guiding the future industrial policy in India.
The book recognises the differential structure of organised and unorganised manufacturing with their distinguished response to the use of labour and capital. The analytical framework consists of an economy-wide approach and structural relationships at the industry level. The underlying sectoral interdependence highlights the job creation potential of domestic manufacturing, which spreads into the non-manufacturing sectors through the essential accounting of the embodied effects. The impact of import utilisations underscores the leakages in the domestic economy in terms of the employment forgone and capital use, thereby highlighting the need to strengthen domestic production. The book clearly identifies the labour- and capital-intensive categories of manufacturing for empirical investigations.
A comprehensive read on labour and capital use in Indian manufacturing, this book in the series Sustainable Industrial Development will appeal to scholars and researchers of economics, applied industrial economics, Indian economy, and business studies. It will also be of interest to professionals and practitioners in policy circles and research think tanks.
List of figures x
List of tables xii
Foreword xiv
Preface xvi
1 Structural transformation and Indian manufacturing 1
2 Analytical approach and database 16
3 Labour use as a factor of production: Accounting for indirect use 29
4 Capital use in production: Recognising the indirect effects 58
5 Relative use of capital and labour as factors of production 84
6 Structural patterns of factor endowments 96
7 Structural relationships of factor endowments 119
8 Key findings and policy implications 137
Annex 1 Details of the input–output model 145
Annex 2 Worker categories in unorganised manufacturing 155
Annex 3 Industry-level endowments of the factors of production 157
Biography
Anjali Tandon is Associate Professor at the Institute for Studies in Industrial Development, New Delhi. Her research focuses on energy, international trade, and industry in a multisectoral framework. Her long experience in consulting projects and publications ranges across energy economy, export diversification, FTAs, agriculture subsidies, and allocative efficiency. Her applied work majorly involves input–output analysis and CGE modelling. Her earlier co-authored book Measuring Structural Change and Energy Use in Indian Economy was published in 2019.
The new analytical approach in the book is a valuable addition to the extant literature on the vital manufacturing sector in India. Anjali Tandon attempts a detailed analysis of the labour and capital inputs and comes up with meaningful policy suggestions.
K. L. Krishna, former Director, Delhi School of Economics
A major contribution in enhancing our understanding of how labour and capital influence the production structure of Indian manufacturing – the key sector to fast economic growth and employment. The book will be of great value to economists, researchers, and students.
Suresh Chand Aggarwal, former Professor, Department of Business Economics, University of Delhi
As labour and capital move from traditional manufacturing to modern manufacturing, overall productivity rises and incomes grow. The speed of such structural transformation is a differentiating factor between high and low growth economies. Anjali Tandon unravels this transformation for Indian manufacturing by including both organised and unorganised segments. The book is a leading resource for researchers working in the field.
Vinish Kathuria, Shailesh J. Mehta Chair Professor, Indian Institute of Technology Bombay
