Ideas of India is a podcast in which Mercatus Senior Research Fellow Shruti Rajagopalan examines the academic ideas that can propel India forward. You can subscribe to the podcast on Apple, Spotify, Google, Overcast, Stitcher or the podcast app of your choice.
This episode is the second in a mini-series of weekly short episodes featuring young scholars entering the academic job market who discuss their latest research. In this episode, Shruti talks with Chhavi Tiwari about her job market paper titled “Internal Migration and Rural Inequalities in India” (with Sankalpa Bhattacherjee). They talk about the differences between seasonal and permanent migration in India, how economic factors influence migration patterns, why women with more children are less likely to work outside the home and much more. Tiwari is an assistant professor of economics at TAPMI, Manipal. She obtained her Ph.D. from the Indian Institute of Management, Ranchi.
SHRUTI RAJAGOPALAN: Welcome to Ideas of India, a podcast where we examine academic ideas that can propel India forward. My name is Shruti Rajagopalan, and we are kicking off the 2021 job market series, where I speak with young scholars entering the academic job market about their latest research on India. I spoke with Dr. Chhavi Tiwari, who is an assistant professor (economics) at TAPMI, Manipal. She received her bachelor’s and master’s in economics at Banaras Hindu University. We discussed her job market paper titled “Internal Migration and Rural Inequalities in India,” co-authored with Sankalpa Bhattacherjee.
We talked about the difference between migration driven by aspiration versus by compulsion, as seen through permanent versus seasonal migration in India; the economic factors that influence migration patterns in India; why women with more children are less likely to work outside the home and much more.
For a full transcript of this conversation, including helpful links of all the references mentioned, click the link in the show notes or visit Discourse Magazine DOT COM.
Hi, Chhavi. Thank you so much for coming on the show.
CHHAVI TIWARI: Hi, Shruti. Thank you very much for having me here.
RAJAGOPALAN: I was really excited to read your paper. This is your recent work where you look at internal migration patterns in India. You find that temporary or seasonal labor migration is the predominant strategy for livelihood that is adopted by the poorest sections of the society, as opposed to more permanent forms of migration, where you typically see participation or high participation from richer or better-off migrants. Can you tell us why this is the case and what is going on with internal migration patterns in India?
TIWARI: This idea came to me when I was actually reading. I was interested in looking at how migration impacts inequalities. When I was reading some papers, I found heterogeneity. Some papers are talking about international migration, which is completely different. Some papers are talking about internal migration but in doctors, in teachers, professors. Those people are from richer households. They migrate for permanent reasons. They go for permanent jobs, better jobs.
But there are some papers which are talking about the poorest of the poor who are going out because they don’t have a job in the village. They are migrating in the season when there is no job, like agricultural lean season. When there is no job in the field, they are going to the city and working. That’s where the idea came to me.
People are looking at the relationship between migration and inequalities, but people are not looking at how these two types of migration are so different from each other, how these two types impact inequalities in the origin point. That’s how I started this. Then I did this research. These are very different because one is because of aspiration, and that is permanent migration. The other is because of compulsion, when there are no jobs. Because these two types of migration are very different, they needed to be treated differently. That’s why I did it.
Migration and Inequality
RAJAGOPALAN: You’re right that migration has an impact on inequality, but the fundamentally unequal society itself impacts migration. There’s this dual aspect to migration. Now, aside from the difference between seasonal and permanent migration that you point out, you also find that both kinds of migration actually reduce inequality in the location or the origin point.
Can you tell me a little bit about how that’s the case? It’s a little bit more intuitive and obvious when it comes to seasonal migration because one would imagine that they go away to peri-urban areas or urban areas, and they come back with the increase in income. How does the mechanism quite work when it comes to permanent migration? What is going on here?
TIWARI: There are two mechanisms that I think work. One is that theorists say that migration efficiently allocates labor from one sector to another sector. What happens is, even in the permanent migration case, people are going out and they are living there. They’re not coming back.
What happens is, the wages in the rural areas increase, and the people who were not getting jobs when the other people were here—they get the jobs, and that’s why inequality improves. The people from the poorer section—they get the job, and the inequality improves, even in the permanent migrant household section.
RAJAGOPALAN: It’s like a demand shock, right? In the point of origin, there’s a bit of a demand shock, and then those who normally would not have been hired now also get hired.
TIWARI: That is it. The other mechanism that you mentioned, that the poorer households—they migrate for seasonal work, and then they come back with the remittances. There are two channels which work to improve inequalities in the original areas.
Barriers That Make Migration Seasonal
RAJAGOPALAN: I want to ask you, given that you find that those who are higher up in the socioeconomic ladder tend to opt for permanent migration, whereas those who are more impoverished opt for seasonal migration, what are some of the barriers for those from poorer sections of society to opt for permanent migration?
Is the problem that they don’t have networks in cities that can help them get jobs? Is the problem that there is not sufficient infrastructure in cities? Is it that there’s not sufficient jobs in cities or the jobs don’t come with certainty, and it’s a very large informal sector? What are the demand and supply problems such that poorer sections of society are not able to benefit from permanent migration and need to rely only on this very itinerant, seasonal migration, which obviously doesn’t give them big gains?
TIWARI: That’s a very good question. There are many barriers. One is, of course, network. Especially, there are some papers which look at the caste network that they lose when they go to the city. One is financial barriers. It takes money to go, and the cost of living is higher in the city. If they don’t get a job, they will have to leave there. In the village, actually, they don’t need to spend that much on food, but in the city, they will have to spend on food. So, one is the money barrier.
Second is security, social security. When the poor migrate to the city, they generally end up in slums, and they get vulnerable to the health risks there. They can’t use this PD [public distribution] system in the destination areas. There are so many factors that work for poorer households not to migrate permanently. They come back. One is networks. They lose networks. They need financial security to go there. They lose social security and, one, the risk is there if they don’t get the job.
RAJAGOPALAN: On this, there has been a fair bit of policy discussion going on. One is of course the idea of introducing something like an urban MGNREGA. There is a very big employment guarantee scheme which is already at plain rural areas, which helps a lot of the more impoverished sections of society or during the lean period so that they don’t have to migrate. Actually, it changes the game a little bit, and it still reduces inequality and supports their income without having to rely on seasonal migration.
Given what happened during COVID, and you saw these masses of urban migrants—permanent and seasonal—literally walking back hundreds and thousands of kilometers to get home. Now there’s a lot of discussion of providing an urban MGNREGA social safety net or an employment guarantee. Do you think that is going to change the nature of the internal migration patterns that we see?
TIWARI: Yes. In my paper, I also included that aspect that Jean Drèze actually recommended, that DUET program for urban works. Yes, that will help because MGNREGA in seasonal migrant households—we have one paper, also, where we find that the people who are working in MGNREGA—actually they are also migrating more. Why? The reason is because they are not getting enough days of work in MGNREGA.
They get networks with the contractors. They build networks, and they migrate more, in fact, for seasonal work because the wages are higher in the urban sector. That DUET program can help because it helps the urban poor. It will help both policymakers as well as migrants, because it will reduce the challenges that government faces to manage urban poor. They will get the job there, and that will also help rural poor who are migrating. That will help both of them.
Urban Regulatory and Welfare Policy
RAJAGOPALAN: So far, we’ve only focused on employment guarantee and things that are directly impacting jobs. Another could potentially be labor law reform to increase the demand for labor potentially and provide a little bit more contract-based labor and job security.
I want to talk a little bit about things that are not directly related to labor but really do impact how we think about migration. This is things like increasing the supply of housing in urban areas because the cost of housing and the reliance on slums is a really, really big problem. This is the ability to access welfare programs. A lot of the welfare benefits, like PDS, a lot of the health schemes—they come through a very specific rural welfare channel and delivery system, so those who migrate to urban areas are not able to rely on those schemes once they’re in a new location.
How much do other public and private goods—like health and housing infrastructure—do you think impede this kind of migration and make it more seasonal rather than permanent?
TIWARI: Yes, there is an urban scheme from the government. They are developing rural clusters in the vicinity of the urban border. If they expand that, and the seasonal migrants can live there, that will improve the situation that you are talking about. Actually, we suggested this in our study, that the urban scheme—it should be expanded, and the security and PDS—all the facilities can be made available there.
That will help both, again, to manage the urban poverty, to manage urban slums and challenges with urbanization and like condition and all. It will also help the rural poor.
RAJAGOPALAN: Also, why not just remove so much of the nonsense regulation there is in urban housing, right? This doesn’t seem like it’s directly related to migration or jobs, but removing FSI, the floor space index requirement, which is so stringent in urban areas and which is causing this explosion of slums. Removing a lot of the rent regulation, removing a lot of the housing regulation and expanding the actual stock of housing.
This is something we’ve simply not focused on very much in India as a policy. Do you think that’s another way to go? It’s hard to provide subsidy after subsidy for both public and private goods for 1.3 billion people, right?
TIWARI: Yes, you are correct. Most of the policies in India are to stop migration, to check migration, not to promote it. Because migration is one of the tools that redistribute labor from less efficient markets to a more efficient markets, it’s better to promote it rather than restrict it. You are right that urban policy reform should be there. Housing reform can be made.
RAJAGOPALAN: How much of this do you think is also because it is very difficult for those in the agricultural sector to sell unproductive agricultural land? This is a really big problem. Land markets in India are very, very broken and fractionalized. You can’t sell agricultural land to nonfarmers. The plot sizes are too small for anyone to have sensible and highly productive agricultural labor output.
In a sense, they are trapped in a very unproductive sector. But it’s also difficult to leave the unproductive sector because you might have a tiny piece of land attached to it, and you’re not able to get the market value for it. It’s still the largest asset that you own. Because of this, you need to keep doing the seasonal migration business because you can’t let go of your largest asset. At the same time, you can’t permanently leave because land security is so poor in India.
TIWARI: I’m not sure about the land-selling laws, but what I know is that selling small land is not a problem, but if it is bigger than some size, then you cannot sell it. I’m not sure about this.
RAJAGOPALAN: No, don’t worry about that. I wasn’t looking for details. I just meant how much do you think the problem is that these people own land, and it is hard for them to escape agriculture for that reason?
TIWARI: What I think, seasonal migration happens in the landless poor who are working as agricultural labor on someone else’s land. When there is a job in the agricultural market, then they don’t migrate, but then when there is no job, they migrate. These are agricultural laborers who are working on someone else’s farm or non-agricultural laborers who are working on some construction job.
Those Left Behind
RAJAGOPALAN: The way I understand a lot of the seasonal migration is that, typically, one member of the household, or maybe two members of the household if it’s a larger family—they usually migrate, and the wives and children and the elderly are left behind. What are some of the implications of seasonal versus permanent migration on the rest of the family? Not just the person who is earning the income through migratory labor.
TIWARI: One of the things that I have observed—it empowers women because if the male member is going out, if there’s no one else left in the male head, it makes women . . . They are working all the work there is. It empowers women. It empowers their decision-making power.
RAJAGOPALAN: Is this effect of empowering women beyond the seasonal migration? Does it come in fits and starts such that when the man of the house is gone away, then the women are empowered, but after the season is over and they come back, after the lean season, again, you see a decrease in women’s empowerment and agency? Or do you see a permanent rise in areas where—
TIWARI: I think it’s not a temporary phenomenon. Once they have that decision power, they can use it again. It empowers women.
Female Labor-Force Participation
RAJAGOPALAN: I wanted to talk to you about some of the other projects you’re working on. In your paper with Srinivas Goli and Anu Rammohan, you’re looking at women and female labor-force participation. You find that women who had more than three children have a higher probability of exiting the labor market.
Of course, these effects are greater for women from richer households than they are for poor women or those from more marginalized, disadvantaged backgrounds. Can you tell me a little bit more about this paper? And what is the mechanism that kicks in, especially after three children, and why doesn’t that happen below three children?
TIWARI: In this paper, we did a lot of things, actually. This paper looks at the impact of fertility levels on female labor market choices. If they’re working or not working, then we took their hours of work, and we took also their earnings. This greater than three children that you’re talking about—it’s one part.
We also found that the total number of children also decreases or increases their probability of exiting from the market. Greater than three children, because of course, if they have more than three children in both rounds, they focus more on the care work rather than going in the job.
In that paper, we also did some household heterogeneous effect, looking at how family is structured. We looked at the family structure. Is this a joint family? If there is an elder woman in the family, or there are any elder siblings of the child. We looked at those aspects also.
Then we found that if there is an elder woman—because in India especially, elder women or men work as a surrogate care worker—if they are present in the family, then actually the probability of women working in the labor market increases. Greater than three children is just one. That is more for disadvantaged strata; that is, exiting the market is more for richer women.
RAJAGOPALAN: Here I want to ask you, I recently read a paper by Ashwini Deshpande and Jitendra Singh, which is on how they believe that it’s actually the demand side that is the reason for low female labor-force participation.
They find, actually, something quite remarkable, quite different from what your findings are, which is that the supply-side demographic characteristics—or household income, structure, timing of childhood, motherhood—all these are not very significant impediments to labor-force participation. It’s really that the demand is low.
You find something quite different. Can you tell me what are the reasons for the differences between your findings and these newer findings that we’ve just seen?
TIWARI: They’re correct in their way, but look at the time period they have considered and the time period we have considered. They have considered from 2016 to 2019, when there were not many new jobs created. Of course, those demand-side factors worked. The time period we have considered is from 2005 to 2011 in between MNREGA that was launched. In that period, actually, women participated more. I still believe that motherhood penalty works in India, but only because the time period they have considered is very different, and the time—
RAJAGOPALAN: Basically, they are looking at post demonetization and GST [goods and services tax], when there was a big slump in economic activity. I guess the way to think about your paper is, given or assuming a certain level of demand for female labor, all these supply factors and household factors and maternity factors play a very important role. But if that demand doesn’t exist, then it doesn’t matter. Is that a good way of thinking about your paper?
TIWARI: Yes, if there’s no demand, they don’t have any chance to participate, but if there is a demand, then mother penalty—of course, that works in Indian market also.
RAJAGOPALAN: You find that the motherhood penalty is lower when there are elderly members in the family, like a mother or a mother-in-law to help with child care work, and also when there are fewer numbers of children in the household as opposed to more children in the household.
TIWARI: We also suggested to have a paid paternity leave in India that we don’t have yet. If the father can take paternity leave, that will also help.
RAJAGOPALAN: I have a slightly different question overall about female labor-force participation. Now, you’ve looked at two, three important factors. You’ve looked at household structure, you’ve looked at seasonal migration, and you’re looking at some of these very specific policies which could potentially lead to greater participation. Overall, what is the way to think about female labor-force participation?
Is the story one of—as Alice Evans or as Ashwini Deshpande and Jitendra Singh point out—is it one of lack of economic growth and structural transformation and therefore, this pull factor of getting families out of the villages and demanding high levels of labor in urban areas, especially for women—that’s the problem? Or do you think it is all these supply-side factors which are preventing families from moving? Once they move, the women are still left behind? Even if the women move, they are stuck with care work? Can you just give us the big picture lens on this problem?
TIWARI: No, but I still believe that demand factor is more important than supply factors. If there are enough demands, then women will also come forward and participate—if there are enough jobs. And in the Indian labor market, you see they’re faced with gender wage gaps. They’re faced with discrimination, other kinds of discrimination, insecurity. In many places, you won’t find a good toilet for women. Those are the other factors you need to reform that demand side. Only then, they will go and participate.
The Missing Middle
RAJAGOPALAN: The underlying story is still one of big economic growth and structural transformation, without which none of this works. There’s another interesting conundrum taking place with female labor-force participation in India, which is that, as household incomes increase, families are likely to engage in less of it.
What is going on there? You see this huge sort of disjoint or discontinuity. At very low levels of income, the women work. At very high levels of income and elite jobs—doctors and lawyers and professors like yourself and me—we tend to work. But everyone in the middle—it’s an interesting conundrum—as household incomes rise, women are less likely to work. What is going on with India that this is the case?
TIWARI: Yes, this is the social norm, I will say. The missing middle is one of the special phenomena in India. What happens if the income of the household increases, then actually, women drop out of the labor force. They think that they don’t need to work because they have enough to take care of themselves. That is one special case in India, I agree. I think there are some papers, and we can actually explore that aspect also—missing middle. Yes.
RAJAGOPALAN: Is it because in Indian society, culturally it is superior for women to look after the children and do household care work, and that is considered the norm?
TIWARI: It is deep-rooted in Indian social norms.
RAJAGOPALAN: Is it because we don’t have supporting facilities available? India doesn’t have mass daycare facilities, crèches where people can . . . so part of it is, of course, because of the family structure. But it seems like there aren’t too many takers for women leaving their children outside the household for daycare in a way there is in other developing countries and developed countries, which obviously ensures or enables greater female labor-force participation.
Is this just cultural norms, and they are going to be slow to break down? What is so peculiar about Indian society that we see this?
TIWARI: I think that it is more about social norms because it comes from the family that you are the mother. You need to take care of the child. It’s not someone else’s job. Most of the time, they want their mother-in-law or their mother to take care of a child, not anyone else outside the family. That’s what the social norm is in India. I think that will go away if we start promoting . . . I still believe that female labor-force participation will increase if there are enough jobs plus security plus if they don’t have wage gaps, it will increase.
RAJAGOPALAN: Basically, you have to make it worthwhile for women to leave the household. On the margin, as the wage increases, it is more attractive to then find alternatives and leave your children somewhere else rather than not. If the wage is too low, then you don’t even consider it. That’s the story that’s going on. In India, it’s simply a story of women will be willing to do it. You just need to pay the compensating differential of the higher wage to attract them.
TIWARI: Yes, I think so.
RAJAGOPALAN: That’s really interesting.
What have you been up to during the pandemic? How has the pandemic treated you?
TIWARI: Initially, I was happy because I had to stay home and I had to work. I can work anytime. Actually, I’m a traveler; I travel a lot. After three months, I need to go somewhere, but that stopped. I started watching Netflix. I’ve not watched this many movies or this many series in my life. I watched so many, but after watching for 10 to 15 days, I got depressed. Then I started working. This repetition is going on. I’m watching; then, for the last 10 days, I have not watched anything.
RAJAGOPALAN: What have you been binge-watching during the pandemic?
TIWARI: The most recent one that I have watched is “Money Heist,” season five or whatever the latest season is. I don’t even remember how many things I have watched. I have watched too many things.
RAJAGOPALAN: Thank you for sharing all your very interesting research. I look forward to reading more of it.
TIWARI: Thank you so much, Shruti. Thank you for having me here. Thank you so much.
RAJAGOPALAN: Thanks for listening to Ideas of India. If you enjoy this podcast, please help us grow by sharing with like-minded friends. You can connect with me on Twitter @srajagopalan. In the coming weeks we will feature weekly short episodes with young scholars entering the academic job market discussing their latest research.
Also check out our new initiative commemorating 30 years of India’s market reforms at the1991project.com. The 1991 Project is an effort to revive the discourse on growth-centered economic reforms in India by focusing on the economic ideas that drove them. In the coming months, we will publish essays, data visualizations, oral histories, podcasts and policy papers demystifying the Indian economy and the 1991 reforms. You can see all the content and subscribe to our newsletter for updates at the1991project.com.