Daughters of employed mothers are more likely to be employed, work more hours and earn higher incomes than their peers whose mothers were not employed, shows a recent paper in Sage Journals by Kathleen L McGinn of Harvard Business School and co-authors. The positive effects are more pronounced in the case of women raised by mothers with more education and employed in higher-skill jobs. The paper, based on data from 29 countries for the period 2002 to 2013, shows that sons raised by employed mothers spend more time caring for family members while daughters spend less time on housework. The study also suggests that daughters who grew up in societies with high levels of female labour force participation had additional sources of inspiration other than their own mother.
Differential privacy could be a solution to protect sensitive data of individuals, shows a paper in the Journal of Big Data by Priyank Jain, research scholar previously associated with Maulana Azad National Institute of Technology, Bhopal and co-authors. Differential privacy is a technology that enables researchers to obtain useful information from a database containing personal information of individuals, but without revealing their identities. The paper cites the example of Apple which has implemented differential privacy in its iOS 10. It allows Apple to collect, store and extract useful information about people’s behaviour, without being able to access data about a single, specific individual. Applying cryptography techniques to differential privacy might further enhance security.
India’s labour laws might not be the main culprit behind the apparent inability of the formal manufacturing sector to create jobs, argues R Nagaraj, professor at the Indira Gandhi Institute of Development Research, Mumbai, in a recent working paper. While India’s labour laws are often rigid, there remains a big gap between the letter of the law and its implementation. There remains widespread evasion of factory registration, resulting in official statistics underestimating the number of small and middle-sized manufacturing firms. Also, other labour laws – such as those protecting workers from layoffs – do not seem to be vigorously implemented. Thus, it would be unfair to blame “rigid” labour laws for thwarting India’s manufacturing sector and the resulting segmentation of the labour market into an organised and unorganised one. Rather, according to Nagaraj, such segmentation is the defining feature of a labour surplus economy with a large traditional (subsistence) sector and a small (rapidly growing) modern sector.
The inability of India’s manufacturing sector to generate sufficient jobs, esp. those catering to the aspirations of better educated youth remains a grave concern, according to a recent working paper by Santosh Mehrotra, professor of economics at JNU. The paper states that job creation has been inadequate amid low credit offtake, low capacity utilization in industry, low investments, etc. The share of youth employed in the manufacturing sector increased between 2004-05 and 2011-12, but saw a sharp fall between 2011-12 and 2015-16. This was also the period when secondary school enrolment increased significantly. There remains a danger that India’s manufacturing sector might not be able to absorb the increasing number of youth who are getting educated or want to simply move away from agriculture. The paper suggests that India needs to offer incentives for labour-intensive industries, provide skills which are in demand, invest in health, education, judiciary and police, etc. to create more jobs.
Cultural proximity impacts the size of loan and loan defaults in India, argues a blog-post by Raymond Fisman, professor at Boston University. The blog, which is based on credit and personal records data for five years from a large state-owned bank in India, finds that access to credit increases while default reduces in cases of social proximity between lenders and borrowers. Looking at 10 distinct cultural groups, the results showed that replacing a Hindu bank manager with a Muslim one led to a jump in how much lending is made to Muslims as well as improved the quality of loans to Muslims. This could, however, be a disadvantage to minority groups in the society, as their chances of encountering people from similar backgrounds would be relatively slim.
Economics Digest runs weekly, and features interesting reads from the world of economics.