Wage differential between caste groups: Are younger and older cohorts different?

Mamata Parhi, Arabsheibani Gholamreza, Tapas Mishra, Prashant Gupta

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Recent literature has provided evidence that a gender and caste-based wage discrimination can exert negative economic impact on a country's development process. Given the enormous contribution of a young population to India's workforce, we examine whether there is any caste-based discrimination considering ‘demographic’ distinction. Using employment and unemployment National Sample Survey data from India for two rounds during the last two decades (1993 and 2010), we find rising wage gap between privileged and marginalized groups within younger and older cohorts across the distribution and over time. Furthermore, we decompose the wage gap using the counterfactual decomposition into endowment effect (explained by differences in characteristics) and a discrimination effect (attributable to unequal returns to covariates). We find that the discrimination effect against marginalized castes (in both cohorts) decreases, implying an increasing endowment effect across the distribution of the wage gap. This discrimination effect is more pronounced among younger compared to older cohorts.

© 2018, Elsevier. The attached document (embargoed until 01/08/2021) is an author produced version of a paper published in ECONOMIC MODELLING uploaded in accordance with the publisher’s self- archiving policy. The final published version (version of record) is available online at the link below. Some minor differences between this version and the final published version may remain. We suggest you refer to the final published version should you wish to cite from it.
Original languageEnglish
Pages (from-to)10-24
Number of pages15
Publication statusPublished - 1 Aug 2018

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